Retained Earnings may be reduced by the closing of the Income Summary account.

Name: Retained Earnings may be reduced by the closing of the Income Summary account.
Brand: Quizplus
Rating: 4.9 (48 reviews)

Question

Quizplus · Accepted Answer

Retained Earnings may be reduced when the Income Summary account, which accumulates net income or loss over the fiscal period, is closed to Retained Earnings. If the period results in a net loss, closing the Income Summary account to Retained Earnings will reduce the Retained Earnings balance.

Retained Earnings May Be Reduced by the Closing of the Income