Use this end-of-period spreadsheet to answer the questions that follow.
-The effect of closing revenues and expenses to Retained Earnings will be to:
A)increase Retained Earnings by $50,000
B)decrease Retained Earnings by $50,000
C)increase Retained Earnings by $237,000
D)decrease Retained Earnings by $237,000

Question

Use this end-of-period spreadsheet to answer the questions that follow.​ 
-The effect of closing revenues and expenses to Retained Earnings will be to:
A)increase Retained Earnings by $50,000 
B)decrease Retained Earnings by $50,000 
C)increase Retained Earnings by $237,000 
D)decrease Retained Earnings by $237,000

Quizplus · Accepted Answer

Closing revenues and expenses to Retained Earnings involves transferring the net income or loss to Retained Earnings. If revenues exceed expenses, Retained Earnings will increase by the net income amount.

Use This End-Of-Period Spreadsheet to Answer the Questions That Follow