The Closing Entry for an Expense Account Would Consist of A

question 50

Multiple Choice

The closing entry for an expense account would consist of a:

• A)Debit to Income Summary and a credit to the expense account.
• B)Debit to the expense account and a credit to Income Summary.
• C)Credit to Retained Earnings and a debit to the expense account.
• D)Credit to Revenue and a debit to the expense account.

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Definitions:

Cash Flow Time Line

Graphical representation of the operating cycle and the cash cycle.

Cash Cycles

The process that covers the time span between a company’s outlay of cash for materials and the collection of cash from customers for goods or services sold.

Inventory Period

The average length of time items remain in inventory before being sold, indicating the efficiency of a company's inventory management.

Producing Goods

The process of creating, manufacturing, or assembling products or goods from raw materials or components.