The journal entry to close expense accounts includes
A) debiting the expense accounts and crediting Income Summary.
B) debiting Income Summary and crediting the expense accounts.
C) debiting the expense accounts and crediting the owner's capital account.
D) debiting the expense accounts and crediting the drawing account.

Question

Quizplus · Accepted Answer

The journal entry to close expense accounts involves transferring the total expenses to Income Summary. This is done by debiting Income Summary and crediting the expense accounts. This will allow the calculation of the net income or loss for the period. The other choices are incorrect because they do not reflect the correct accounting treatment for closing expense accounts.

The Journal Entry to Close Expense Accounts Includes