The Profit or Loss Summary account is what type of account?
A) short-term account
B) asset account
C) temporary account
D) current account

Question

Quizplus · Accepted Answer

The Profit or Loss Summary account is a temporary account that is used to summarize revenue and expenses for a specific accounting period, typically a month or a year. It is closed at the end of the accounting period and its balance is transferred to the retained earnings account, which is a permanent account. Therefore, the correct answer is C, temporary account. Choices A, B, and D are incorrect because they do not accurately describe the nature of the Profit or Loss Summary account.

The Profit or Loss Summary Account Is What Type of Account