An important purpose of closing entries is to
A)help achieve the goals of the matching principle.
B)set permanent account balances to zero to begin the next period.
C)update the nominal accounts at year end.
D)transfer net income or net loss to the owner's Capital account.

Question

Quizplus · Accepted Answer

Closing entries are used to transfer the balances of temporary accounts (revenues, expenses, and dividends) to the owner's Capital account, reflecting the net income or net loss for the period.

An Important Purpose of Closing Entries Is to