In the closing procedure, the expense account(s) should be closed into the:
A) Income Summary account.
B) Net Income account.
C) Expense Payable account.
D) Drawings Account.

Question

Quizplus · Accepted Answer

The expense account(s) should be closed into the Income Summary account as part of the closing procedure. This allows for the calculation of net income, which is then transferred to the retained earnings account. Closing the expense accounts into the Net Income account or Expense Payable account is not correct. The Drawings Account is used to record withdrawals by the owner and is closed into the retained earnings account, not the expense accounts.

In the Closing Procedure, the Expense Account(s) Should Be Closed