Use this adjusted trial balance to answer the following question. The entry to close Income Summary includes a

Question

Use this adjusted trial balance to answer the following question.  The entry to close Income Summary includes a

Quizplus · Accepted Answer

The entry to close Income Summary involves transferring the net income or loss to Retained Earnings. If the net income for the period is $14,000 (credit balance in Income Summary), then it would be closed by debiting Income Summary for $14,000 and crediting Retained Earnings for the same amount. Choices A and D are incorrect because there is no information in the adjusted trial balance to suggest that Common Stock or Retained Earnings should be credited. Choice B is incorrect because it implies that the net income for the period is $24,000, which is not supported by the adjusted trial balance.

Use This Adjusted Trial Balance to Answer the Following Question