The entry to close Cost of Goods Sold at the end of the year includes a debit to Income Summary.

Name: The entry to close Cost of Goods Sold at the end of the year includes a debit to Income Summary.
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Cost of Goods Sold is an expense account, which means it has a debit balance. To close this account at the end of the year, we need to transfer its balance to the Income Summary account. To do this, we debit Income Summary and credit Cost of Goods Sold.

The Entry to Close Cost of Goods Sold at the End