The income statement columns in the worksheet show that debits are equal to $55,800 and credits are $67,520. What does this information mean to the accountant?
A) Net income of $11,720
B) Net loss of $11,720
C) The accounts are out of balance, indicating an error has been made.
D) The accounts have not been updated.

Question

Quizplus · Accepted Answer

The difference between credits and debits in the income statement columns indicates a net income. Since credits ($67,520) exceed debits ($55,800) by $11,720, it reflects a net income of $11,720.

The Income Statement Columns in the Worksheet Show That Debits