1. Section 2Extending Amounts Across the Work Sheet What You’ll Learn  How to extend amounts to the Balance Sheet and Income Statement sections.  The importance of the matching principle.  How to calculate and show the net income or net loss on the work sheet. What You’ll Learn  How to extend amounts to the Balance Sheet and Income Statement sections.  The importance of the matching principle.  How to calculate and show the net income or net loss on the work sheet.

2. Why It’s Important Preparing the work sheet helps you understand the relationship of all ledger accounts and where they are reported. Why It’s Important Preparing the work sheet helps you understand the relationship of all ledger accounts and where they are reported. Section 2Extending Amounts Across the Work Sheet (con’t.) Key Terms  matching principle  net income  net loss Key Terms  matching principle  net income  net loss

3. The Balance Sheet Section Section 2Extending Amounts Across the Work Sheet (con’t.)

4. The Income Statement Section Section 2Extending Amounts Across the Work Sheet (con’t.)

5. Totaling the Income Statement and Balance Sheet Sections Section 2Extending Amounts Across the Work Sheet (con’t.)

6. Showing Net Income on the Work Sheet Section 2Extending Amounts Across the Work Sheet (con’t.)

7. Completing the Work Sheet Section 2Extending Amounts Across the Work Sheet (con’t.)

8. Check Your Understanding What is the effect of net income on the capital account? Section 2Extending Amounts Across the Work Sheet (con’t.)