accounting chapter 8

net income

results when revenue is larger than expenses

balance sheet section

the asset, liability, and owners equity accounts are extended to this

ruling

means drawing a single line under a column of amounts

credit

a net loss is entered in this column

income statement section

revenue and expense accounts are listed in the trial balance section of the work sheet and the

matching principle

allows a business to match revenue against expenses as a means of measuring profit for the period

work sheet

working paper used to collect information from the general ledger account

trial balance

the first 2 columns of the work sheet are used to ender the

debit

if there is a net loss for the period, it is entered in the

extending

transferring balances from the trial balance section of the worksheet to either the balance sheet section or the income statement section

net loss

if the total of the credit column of the income statement section is less than the debit column

capital

the amount of net income for the period is added to the balance sheet credit total because it increases the balance in the

heading

of the worksheet answers the questions who what and when

fiscal period

a worksheet is prepared at the end of each

pen or pencil

the worksheet is prepared in

liquidity

account titles are listed in

balance sheet

all assets accounts are extended to the

5/sixth step

preparing the worksheet is the