a) Both include net income. b) Both show stockholders' equity. c) Both show the value of cash accounts.
Work Step by Step
a) The income statement shows net income for a given period. Net income is shown on the retained earnings statement because it increases retained earnings. b) The retained earnings shows the current retained earnings balance. Retained earnings is a type of equity that is shown on the balance sheet. c) The balance sheet lists all the assets of a company. The cash balance shown on the cash flow statement is a type of asset.