After all the revenue and expense accounts are closed,the Income Summary account will have a credit balance if the entity has net income.

Question

Quizplus · Accepted Answer

The purpose of the Income Summary account is to summarize the revenues and expenses for the period and determine the net income or loss. If there is net income, the credits (revenues) will exceed the debits (expenses) and the Income Summary account will have a credit balance. This credit balance is then closed to the Retained Earnings or Owner's Equity account.

After All the Revenue and Expense Accounts Are Closed,the Income