Which of the Following Entries Will Be Necessary to Close

question 159

Multiple Choice

Which of the following entries will be necessary to close the insurance expense account at the end of the year?

• A) Debit Insurance expense and credit Income summary.
• B) Debit Insurance expense and credit Capital.
• C) Debit Capital and credit Insurance expense.
• D) Debit Income summary and credit Insurance expense.

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Definitions:

Distributions

Payments made by a fund, trust, or company to its shareholders or partners, often from profits or interest earned.

Owners

Individuals or entities that hold a property right or equity interest in a business.

Financial Flexibility

The ability of an individual or organization to adapt to financial challenges and take advantage of opportunities, maintaining operation under various financial conditions.