The Income Summary account is used to:
A)Adjust and update asset and liability accounts.
B)Close the revenue and expense accounts.
C)Determine the appropriate dividend amount.
D)Replace the income statement under certain circumstances.
E)Replace the retained earnings account in some businesses.

Question

Quizplus · Accepted Answer

The Income Summary account is used to close the revenue and expense accounts at the end of the accounting period by transferring their balances to the Income Summary account. The balance of the Income Summary account is then transferred to the owner's equity or retained earnings account, depending on the ownership structure of the business.

The Income Summary Account Is Used To