Revenues and expenses are transferred to the ________ account before their final transfer into the Retained Earnings account.
A)Net Income
B)Income Summary
C)Dividends
D)Assets

Question

Quizplus · Accepted Answer

Revenues and expenses are closed out to the Income Summary account before their final transfer into the Retained Earnings account. The Income Summary account represents the net income or loss for the period and serves as a temporary account to facilitate the closing process. The balance in the Income Summary account is then transferred to the Retained Earnings account, which is a permanent account that reflects the accumulated earnings of the company. Therefore, the best choice is B, Income Summary.

Revenues and Expenses Are Transferred to the ________ Account Before