A loss
A)occurs if operating expenses exceed cost of goods sold.
B)is not closed to Retained Earnings if it would result in a debit balance in that account.
C)is closed to Retained Earnings even if it would result in a debit balance in that account.
D)is closed to the Common Shares account.

Question

Quizplus · Accepted Answer

Losses are closed to the Retained Earnings account at the end of the fiscal period, regardless of whether this results in a debit balance in that account. This is a standard accounting practice to reflect the company's performance accurately in its financial statements.

A Loss