Closing entries result in the transfer of net income or loss into the Retained Earnings account.

Name: Closing entries result in the transfer of net income or loss into the Retained Earnings account.
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Question

Quizplus · Accepted Answer

Closing entries are made at the end of an accounting period to transfer the balances of temporary accounts (e.g. revenue, expenses, gains, losses) to the Retained Earnings account. This results in the net income or loss being reflected in the Retained Earnings account, which is a permanent account.

Closing Entries Result in the Transfer of Net Income or Loss