When Using the Trial Balance Worksheet to Prepare the Statement

question 3

Multiple Choice

When using the trial balance worksheet to prepare the statement of retained earnings,what information is used from the trial balance worksheet?

• A)net income or net loss
• B)revenues and expenses
• C)beginning balance of retained earnings and dividends
• D)cash balance

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Definitions:

Income Summary

An account used in the closing process to combine all income and expense accounts and show the period's net income or loss.

Perpetual Inventory System

An accounting method that records purchases and sales of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.

Delivery Expense

This refers to the costs associated with transporting goods from one place to another, including shipping fees, freight, and packaging costs.

Contra Revenue Accounts

Accounts that are used to record reductions in revenue, such as sales returns, allowances, and discounts.