The Income Statement Columns in the Work Sheet Show That

question 91

Multiple Choice

The Income Statement columns in the work sheet show that debits total $55,800 and credits total $62,705. What does this information mean to the accountant?

• A) Net income is equal to $6,905.
• B) Net loss is equal to $6,905.
• C) The accounts are out of balance, indicating an error has been made.
• D) The accounts have not been updated.

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Definitions:

Federalism

A system of government in which power is divided between a central authority and constituent political units, like states.

Unitary

Relating to a system of government where the central government holds supreme power, with any regional governments existing solely to execute the central government's directives.

Totalitarian

A system of government where the state recognizes no limits to its authority and strives to regulate every aspect of public and private life wherever feasible.

Federal Republic

A form of government composed of a union of states or regions under a central (federal) government, with powers divided between the central government and its constituent parts.