The balance in the profit or loss summary account before it is closed represents:
A) total expenses.
B) profit (or loss) less drawings.
C) total owner's capital.
D) profit (or loss) for the period.

Question

Quizplus · Accepted Answer

The balance in the profit or loss summary account before it is closed represents the profit (or loss) for the period. This account is used to summarize all the revenues and expenses for the period, and the resulting balance represents the net income (or loss) for the business. This balance is then transferred to the owner's capital account, which increases (or decreases) the owner's equity in the business.

The Balance in the Profit or Loss Summary Account Before