The Amount of Net Income Is Added on the Statement

question 122

True/False

The amount of net income is added on the statement of retained earnings.

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Definitions:

Normal Balance

The side (debit or credit) of an account that is expected to have a higher balance, reflecting its nature in accounting.

Financial Statement

Reports that provide information about a company's financial condition, performance, and cash flows, including balance sheets, income statements, and more.

Permanent/Temporary

Classification of accounts; permanent accounts are balance sheet accounts that carry their ending balances into the next accounting period, while temporary accounts are closed and zeroed out at the end of each period.

Normal Balance

The side (debit or credit) on which increases are recorded in an account, based on the type of account.