If Income Summary has a credit balance after closing revenue and expense accounts, this indicates a net loss.

Name: If Income Summary has a credit balance after closing revenue and expense accounts, this indicates a net loss.
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If Income Summary has a credit balance after closing revenue and expense accounts, this indicates a net profit, not a loss. Revenue increases the credit balance, and expenses decrease it. A net credit balance thus indicates revenues exceeded expenses.

If Income Summary Has a Credit Balance After Closing Revenue