A net 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.
C)is closed to Retained Earnings even if it would result in a debit balance.
D)is closed to the Paid-in Capital account of the stockholders' equity section of the balance sheet.

Question

Quizplus · Accepted Answer

A net loss is closed to Retained Earnings, regardless of whether it results in a debit balance, as it reflects the decrease in equity due to the loss.

A Net Loss