Under which circumstance would one less closing entry than usual be made?
A)When a net loss has been suffered
B)When withdrawals by the owner are equal to net income for the period
C)When net income is zero
D)When the owner's Capital account is zero prior to posting of closing entries

Question

Quizplus · Accepted Answer

Closing entries are made to transfer the balances of temporary accounts (revenue, expense, and withdrawal accounts) to the owner's capital account. If the net income is zero, there is no need to transfer any balance, and hence one less closing entry would be made.

Under Which Circumstance Would One Less Closing Entry Than Usual