If the Total Debits Exceed the Total Credits in the Balance

question 128

Multiple Choice

If the total debits exceed the total credits in the balance sheet columns of the worksheet, stockholders' equity

• A)will increase because net income has occurred.
• B)will decrease because a net loss has occurred.
• C)is in error because a mistake has occurred.
• D)will not be affected.

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Definitions:

Rent Revenue

Income earned by a company from renting out properties or equipment to others.

Deferred Tax Liabilities

The amount of income tax payable in future reporting periods in respect of taxable temporary differences.

Depreciation Adjustment

Accounting action that alters the depreciation expense recognized for an asset, potentially due to changes in estimate, salvage value, or useful life.

Tax Effect

The impact of tax laws on the financial statements of a company, particularly concerning deferred tax assets and liabilities.