Revenues total $20,200, expenses total $17,300, and the owner's withdrawals account has a balance of $12,600. What is the balance in the income summary account prior to closing net income or net loss?
A)$2,900 debit
B)$9,700 debit
C)$2,900 credit
D)$9,700 credit

Question

Quizplus · Accepted Answer

The balance in the income summary account prior to closing net income or net loss is calculated by subtracting total expenses from total revenues. In this case, $20,200 (revenues) - $17,300 (expenses) = $2,900. Since revenues exceed expenses, this results in a net income, which is represented as a credit balance in the income summary account.

Revenues Total $20,200, Expenses Total $17,300, and the Owner's Withdrawals