Which of the following is true of the first closing entry?
A)Retained Earnings is not involved in the entry.
B)Retained Earnings is always debited.
C)Retained Earnings is always credited.
D)Retained Earnings may be debited or credited.

Question

Quizplus · Accepted Answer

The first closing entry involves transferring the balances of all revenue and expense accounts to Retained Earnings. Depending on whether the company has a net income or a net loss, Retained Earnings may be credited (if there's a net income) or debited (if there's a net loss).

Which of the Following Is True of the First Closing