If you transfer Net Income into Capital, on the Balance Sheet it will show as a negative in Retained Earnings and a positive in Net Income until the following year.TRUE or FALSE Give a justification for your answer.

If you transfer Net Income into Capital, on the Balance Sheet it will show as a negative in Retained Earnings and a positive in Net Income until the following year.TRUE or FALSE Give a justification for your answer.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

If you transfer Net Income into Capital, on the Balance Sheet it will show as a negative in Retained Earnings and a positive in Net Income until the following year.TRUE or FALSE

Give a justification for your answer.

Definition Definition Remaining net income of the company after the required dividends are paid to shareholders. This surplus money is usually invested back into the business to expand its business operations or launch a new product.

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