Which of the following statements is not correct?
A)The owner's drawing account is closed to the Income Summary account.
B)Before the Income Summary account is closed, its balance represents the net income or net loss for the accounting period.
C)The Income Summary account is used only at the end of an accounting period to help with the closing procedure.
D)The Income Summary account is a temporary owner's equity account.

Question

Quizplus · Accepted Answer

The owner's drawing account is not closed to the Income Summary account; it is closed directly to the owner's capital account. The Income Summary account is used to summarize revenues and expenses, and its balance is transferred to the owner's capital account, not the drawing account.

Which of the Following Statements Is Not Correct