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Unformatted text preview: ACG Final Review Chapter 4 The flow of accounting information - is from the unadjusted trial balance to the adjusted trial balance to the income statement and balance sheet columns. Once the accounting information is extended to the income statement and balance sheet- the difference between the debits and the credits in the income statement columns will be equal to the difference between the debits and credits in the balance sheet. Once the adjusted trial balance is extended to the income statement and to the balance sheet, if the debit column of the income statement is lower than the credit column:- the difference will be reported as a net income Why: If the credits on the Income Statement are more than the debits, this indicates that a credit will be posted to the Retained Earnings account during the closing entries. A credit to the Retained Earnings account indicates a net income. The classified balance sheet will include subsections that are not included in a regular balance sheet. Which of the following are examples of some of the subsections that are found on the classified balance sheet?- Current Assets, Long-term Liabilities, Property, Plant, and Equipment Why: Correct. Under the asset section of the balance sheet, subsections include current assets and Why: Correct....
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