The journal entry to close revenue accounts includes
A) debiting the revenue accounts and crediting Income Summary.
B) debiting Income Summary and crediting the revenue accounts.
C) debiting the revenue accounts and crediting Cash.
D) debiting the revenue accounts and crediting the drawing account.

Question

Quizplus · Accepted Answer

The correct journal entry to close revenue accounts involves debiting the revenue accounts to reduce their balance to zero and crediting the Income Summary account to transfer the revenue amounts into it. This is part of the process to prepare the accounts for the next accounting period.

The Journal Entry to Close Revenue Accounts Includes