The net income of Plum Consultancy is $500,000. The company has passed the closing entries for revenue and expense accounts. Which of the following is the closing entry to transfer the net income? a. A debit to Income Summary for $500,000 and a credit to Capital for $500,000 b. A debit to Consulting Revenue for $500,000 and a credit to Capital for $500,000 c. A debit to Capital for $500,000 and a credit to Consulting Revenue for $500,000 d. A debit to Capital for $500,000 and a credit to Income Summary for $500,000
The net income of Plum Consultancy is $500,000. The company has passed the closing entries for revenue and expense accounts. Which of the following is the closing entry to transfer the net income? a. A debit to Income Summary for $500,000 and a credit to Capital for $500,000 b. A debit to Consulting Revenue for $500,000 and a credit to Capital for $500,000 c. A debit to Capital for $500,000 and a credit to Consulting Revenue for $500,000 d. A debit to Capital for $500,000 and a credit to Income Summary for $500,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The net income of Plum Consultancy is $500,000. The company has passed the closing entries for revenue and expense accounts. Which of the following is the closing entry to transfer the net income?
a. A debit to Income Summary for $500,000 and a credit to Capital for $500,000
b. A debit to Consulting Revenue for $500,000 and a credit to Capital for $500,000
c. A debit to Capital for $500,000 and a credit to Consulting Revenue for $500,000
d. A debit to Capital for $500,000 and a credit to Income Summary for $500,000
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