When a company has a net loss,the net loss amount is entered on the work sheet on the
A)credit side of both the Income Statement and the Balance Sheet columns.
B)credit side of the Income Statement columns and the debit side of the Balance Sheet columns.
C)debit side of the Income Statement columns and the credit side of the Balance Sheet columns.
D)debit side of both the Income Statement and the Balance Sheet columns.

Question

Quizplus · Accepted Answer

A net loss is recorded on the credit side of the Income Statement columns to balance off the expenses that exceeded the revenues. It is entered on the debit side of the Balance Sheet columns because it reduces the company's equity.

When a Company Has a Net Loss,the Net Loss Amount