J. Oros showed a net loss of $3,250. The entry to close the Income Summary account would include a
A) debit to Oros, Capital, $3,250.
B) debit to Income Summary, $3,250.
C) credit to Oros, Capital, $3,250.
D) credit to Cash, $3,250.

Question

Quizplus · Accepted Answer

When a business shows a net loss, the amount is debited to the owner's capital account to decrease the capital. This reflects the reduction in equity due to the loss.

J Oros Showed a Net Loss of $3,250