When closing the Income Summary account when there is a net income:
A) Capital would increase.
B) Revenue would decrease.
C) Capital would remain the same.
D) None of these is correct.

Question

Quizplus · Accepted Answer

When closing the Income Summary account with a net income, the amount is transferred to the owner's capital account, effectively increasing the capital. This is because net income represents the excess of revenues over expenses, which increases the owner's equity in the business.

When Closing the Income Summary Account When There Is a Net