On a worksheet used in a manual accounting system to prepare the financial statements:
A) profit is shown as a debit to the income statement column and a credit to the balance sheet column.
B) profit is not shown.
C) profit is shown as a credit to the capital account and a debit to the bank account.
D) profit is shown as a debit to the adjustments column and a credit to the balance sheet column.

Question

Quizplus · Accepted Answer

Profit is shown as a debit to the income statement column because it reduces the total expenses, thereby increasing net income. It is credited to the balance sheet column because it increases the owner's equity.

On a Worksheet Used in a Manual Accounting System to Prepare