The Income Summary Account Is Used To

question 3

Multiple Choice

The Income Summary account is used to:

• A)Adjust and update asset and liability accounts.
• B)Close the revenue and expense accounts.
• C)Determine the appropriate dividend amount.
• D)Replace the income statement under certain circumstances.
• E)Replace the retained earnings account in some businesses.

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Definitions:

Binding

In legal terms, describing an agreement or contract that is legally enforceable by law.

Theory Z

A management philosophy that stresses employee participation in all aspects of company decision making.