The Elimination Principle Is the Idea That Profits Are Eliminated

question 90

True/False

The elimination principle is the idea that profits are eliminated by firms exiting the industry and losses are eliminated by firms entering the industry.

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Definitions:

Worksheet

A document used by accountants to organize various financial statements and supporting details during an accounting cycle.

Net Income

The total revenue of a business minus total expenses, indicating the company's profit after all expense deductions.

Income Statement

A financial statement that reports a company's revenues and expenses over a specific period, showing the net profit or loss.

Adjustments Column

Part of an accounting worksheet where entries are made to update account balances before preparing financial statements.