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12.07.2022 - 14:26

After preparing and posting the closing entries to close revenues (and gains) and expenses (and losses) into the income summary, the income summary account has a debit balance of $33,000. The entry to close the income summary account will include: a. a de

Question:

After preparing and posting the closing entries to close revenues (and gains) and expenses (and losses) into the income summary, the income summary account has a debit balance of $33,000. The entry to close the income summary account will include:

a. a debit of $33,000 to owner withdrawals.

b. a credit of $33,000 to owner withdrawals.

c. a debit of $33,000 to income summary.

d. a debit of $33,000 to owner capital.

e. a credit of $33,000 to owner capital.

Answers (0)

Rosetta April 2, 2023 в 21:29

The correct answer is c. a debit of $33,000 to income summary. This is because the income summary account is used to transfer the net income or loss to the owner's equity account. In this case, since the income summary account has a debit balance of $33,000, it means that the expenses and losses exceeded the revenues and gains. To close the account and transfer the balance to the owner's equity, a debit entry of $33,000 will be made to the income summary account.

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