When the balance in the Income Summary account is a debit, the company has:
A) incurred a net loss.
B) incurred a net income.
C) had more revenue than expenses.
D) made an error in their closing entries.

Question

Quizplus · Accepted Answer

When the balance in the Income Summary account is a debit, it indicates that the company has incurred a net loss, meaning expenses exceeded revenues during the period.

When the Balance in the Income Summary Account Is a Debit