8 Questions
When closing the revenue account, which entry includes a credit to income summary for?
Transferring the credit balance of the revenue account to the income summary account
In the closing entry for the revenue account, what does the income summary account represent?
A temporary account used to summarize revenue and expense balances
What is the purpose of closing the revenue account?
To calculate the company's net income or net loss for the period
How does the purchase of baking supplies on account affect the Baking Supplies account?
Increase
What is the effect of the owner's investment of cash on the Cash account?
Increase
What is the impact of providing services on account on the Service Revenue account?
Increase
How does the payment of rent expense affect the Rent Expense account?
Decrease
What is the impact of the collection on account on the Accounts Receivable account?
Decrease
Test your knowledge of accounting principles with this quiz on closing the revenue account. Explore the purpose of the income summary account and understand the closing entry process for revenue.
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