Which of the following statements about revenues and expenses is correct?
A)If revenues are less than expenses,the company has a net loss and Retained Earnings decreases.
B)If revenues are greater than expenses,the company has net income and Common Stock increases.
C)If revenues are less than expenses,the company has a net loss and Common Stock increases to balance off the loss.
D)If revenues are greater than expenses,the company has net income and Retained Earnings decreases.

Question

Quizplus · Accepted Answer

Net income,the excess of revenues over expenses,increases Retained Earnings.On the other hand,if revenues are less than expenses,a net loss results,which decreases Retained Earnings.

Which of the Following Statements About Revenues and Expenses Is