After All of the Account Balances Have Been Extended to the Balance

question 125

Multiple Choice

After all of the account balances have been extended to the Balance Sheet columns of the work sheet, the totals of the debit and credit columns show debits of $37,686 and the credits of $41,101. This indicates that

• A) neither net income or loss can be calculated because it is found on the income statement
• B) the company has a net loss of $3,415 for the period
• C) the company has a net income of $3,415 for the period
• D) The amounts are out of balance and need to be corrected

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Definitions:

Materials

Inputs and supplies used in the production of goods or in the provision of services.

Completed Unit

A term used in manufacturing and production to describe a product that has finished all stages of the production process and is ready for sale.

First-in

A reference to the "First-In, First-Out" (FIFO) inventory method where the oldest inventory items are recorded as sold first.

Processing Department

A division or unit within a company where a particular phase of the manufacturing process is completed.