Which Statement Is Incorrect

question 6

Multiple Choice

Which statement is incorrect?

• A)Revenue accounts are closed to Income Summary.
• B)Income Summary is closed to Capital.
• C)Withdrawals are closed to Income Summary.
• D)Expense accounts are closed to Income Summary.
• E)Withdrawals are closed to Capital.

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Definitions:

Normal Balance

The typical or usual balance of an account, which can be a debit for asset and expense accounts, or a credit for liability, equity, and revenue accounts.

Financial Statement

Comprehensive reports that provide information regarding a company's financial performance and condition.

Permanent/Temporary

Categories that differentiate between enduring or long-term elements and those expected to last for only a limited period.

Natural Resource Cost

The initial cost of acquiring and preparing natural resources for extraction, not including exploration or development.