The income statement for the month of June, 2022 of Snap Shot, Inc. contains the following information: $\begin{array}{lr}\text { Revenues }&&\$7,300\
\text { Expenses: }\
\text { Salaries and Wages Expense } & \$ 3,000 \
\text { Rent Expense } & 1,300 \
\text { Advertising Expense } & 700 \
\text { Supplies Expense } & 200 \
\text { Insurance Expense } & 100 \
\text { Total expenses }&&5,300\\text { Net income (loss) }&&\$2,000
\end{array}$ The entry to close Income Summary to Owner's Capital includes

Question

Quizplus · Accepted Answer

The entry to close Income Summary to Owner's Capital involves transferring the net income or loss for the period to the owner's equity account. Since the income statement shows a net income of $2,000, the entry should include a credit to Owner's Capital for $2,000. A and B are incorrect because they do not reflect the transfer of net income to the owner's equity account. C is incorrect because it suggests a credit to Income Summary, which is the temporary account used to summarize revenues and expenses for the period and is closed at the end of the period.

The Income Statement for the Month of June, 2022 of Snap