In the Process of Completing a Work Sheet, the Accountant

question 166

Multiple Choice

In the process of completing a work sheet, the accountant determines that the Income Statement debit column totals $83,000, while the Income Statement credit column totals $65,000. To enter net income (or net loss) for the period into the work sheet would require an entry to

• A) it is not practical to enter Net Income (or Net Loss) on the work sheet.
• B) the Balance Sheet & Statement of Owner's Equity debit column and the Income Statement credit column.
• C) the Adjustments debit column and the Adjustments credit column.
• D) the Unadjusted Trial Balance debit column and the Adjustments credit column.
• E) the Income Statement debit column and the Balance Sheet & Statement of Owner's Equity credit column.

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Definitions:

Implicit Cost

Refers to the opportunity costs that are not directly paid for in money but represent the loss of value from using resources for a particular venture instead of their best alternative use.

Explicit Cost

Direct, out-of-pocket payments for goods or services used in the production of a product or offering of a service.

Sole Proprietor

An individual who owns and operates a business alone, bearing all the responsibilities and benefits of the business.

Short Run

A timeline in economics where at least one factor of production is fixed, constraining the ability to adjust to changing economic conditions.