Charge to Earnings

A change on the balance sheet must likewise flow through the income statement. In the event that a balance sheet asset expansions in value, the company understands a gain on its income statement, and on the off chance that an asset diminishes in value (or another liability is made), a charge is taken against earnings. The most common charges are writedowns in inventory or plants and equipment, frequently set off by a merger or other corporate action.
For example: Say a company believed its PCs were worth $1,000, and they've been carried on the books at that cost, however - - a modern day miracle - - they're truly worth $100. Then it needs to take a charge to earnings so the balance sheet can mirror the true asset value.