Question 2 of 4 Date ACCount Titles and Explanation Debit July 31 (To close revenue accounts) July 31 (To close expense accounts) July 31 (To close net income / (loss))
To close a temporary account (Income and expense account) and transfer those accounts to a permanent account (balance sheet items) e record closing entries at the end of the accounting period.
The closing entries are as follows
a. To close revenue account.
Debit: Revenue Account xxx
Credit Income Summary xxx
b. To close expense accounts
Debit Income Summary xxx
Credit Expense Accounts xxx
c. To transfer net income to retained earning ( Assume there was net income)
Debit Income Summary xxx
Credit Retained Earning xxx
d. To close Dividend Account
Debit Retained Eanring xxx
Credit Dividend Account xxx
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