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hi mike,
a very simple question that i dont seem to find an answer to.during the year a company suffered a loss of 1000 $ in P/L.
The double entry for this in the Sofp will be to debit retained earnings and credit ???
thanks
In the process of arriving at the figure for the year’s profits, you have calculated that the expenses exceed the revenues by that $1,000
To balance the ‘profit or loss ACCOUNT’ – it IS a T account! – we need to credit the profit or loss account and debit retained earnings
Ok?
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