A closing entry may include a
Blank
______.

Question

A closing entry may include a 
Blank
______.

BlackTom AI · Accepted Answer

Expenses are closed by crediting the expense accounts and debiting Income Summary (or Retained Earnings). This is the key closing-entry principle.

1. Relevant knowledge points and concepts
- Closing entries are made at period end to transfer balances of temporary accounts (revenues, expenses, dividends) to permanent equity accounts.
- Revenues are closed by debiting each revenue account and crediting Income Summary (or Retained Earnings).
- Expenses are closed by debiting Income Summary and crediting each expense account (thus reducing expense account balances to zero).
- Asset and liability accounts (e.g., Prepaid Insurance, Unearned Revenue) are permanent and are not closed.

2. Step-by-step reasoning process
- Identify which accounts are temporary: Wages Expense is an expense (temporary), Interest Revenue is a revenue (temporary), Unearned Revenue is a liability (permanent), Prepaid Insurance is an asset (permanent).
- For expense accounts (like Wages Expense), the closing entry must remove the expense balance by crediting the expense account and debiting Income Summary.
- Therefore a closing entry may include a credit to Wages Expense.

3. Intermediate steps / example
- Suppose Wages Expense has a $3,000 debit balance for the period.
- Closing entry: Debit Income Summary $3,000; Credit Wages Expense $3,000.
- After this entry, Wages Expense balance = $0 (closed), and Income Summary reflects net income impact.

4. Why the correct answer is correct
- The correct closing procedure for expenses is to credit the expense account to bring its balance to zero. Thus “credit to Wages Expense” is a possible line in a closing entry.

5. Why the other options are incorrect
- Credit to Interest Revenue: Revenues are closed by debiting revenue accounts (not crediting them). So crediting Interest Revenue would be the wrong sign.
- Debit to Unearned Revenue: Unearned Revenue is a liability (permanent), not closed; any debit to it would be an adjusting entry when revenue is earned, not a closing entry.
- Debit to Prepaid Insurance: Prepaid Insurance is an asset (permanent), not closed; debiting it would increase the asset, not a closing action.

6. Conclusion
A closing entry may include a credit to Wages Expense. This matches the provided correct answer: "credit to Wages Expense."

A closing entry may include a Blank ______.单项选择题

类似问题

During the closing process, the closing entry to reduce the sales revenue normal account balance to requires the revenue account be debited.

The entries that transfer the revenue, expense, and withdrawals balances to the Owner, Capital account to prepare the company's books for the next period are called ________.

Closing entries

Which of the following accounts will not be closed to the capital account at the end of the year?

Which of the following accounts will be closed by crediting retained earnings?

Which of the following statements is true?

Journal entries recorded at the end of each accounting period to prepare the revenue, expense, and dividend accounts for the upcoming period and to update the retained earnings account for the events of the period just finished are referred to as:

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