A net loss will result during a time period when
A) assets exceed liabilities.
B) assets exceed stockholders' equity.
C) expenses exceed revenues.
D) revenues exceed expenses.

Question

Quizplus · Accepted Answer

A net loss occurs when expenses exceed revenues, indicating that the business incurred more costs than it generated in revenue during a given period. This could result from a variety of factors, such as high expenses, low sales, or a combination of both. A and B are incorrect because having assets exceeding liabilities or stockholders' equity is a positive sign for a business, while D refers to a net income, which is the opposite of a net loss.

A Net Loss Will Result During a Time Period When