The net income (or loss) for the period
A) is found by computing the difference between the income statement credit column and the balance sheet credit column on the worksheet.
B) cannot be found on the worksheet.
C) is found by computing the difference between the income statement columns of the worksheet.
D) is found by computing the difference between the trial balance totals and the adjusted trial balance totals.

Question

Quizplus · Accepted Answer

The net income (or loss) for the period is found by computing the difference between the income statement columns of the worksheet. The income statement columns of the worksheet show the revenues and expenses for the period, and the difference between the two is the net income or net loss. The other options are incorrect – choice A refers to the computation of net income (or loss) on the work sheet, but the procedure described is not correct, choice B is incorrect because the net income (or loss) can be found on the worksheet, and choice D refers to the computation of adjusted trial balance, which is a step in the accounting cycle, but does not directly result in the computation of net income (or loss).

The Net Income (Or Loss) for the Period