The income statement for the year 2016 of Bugati Co. contains the following information: Revenues $ 73 , 000 Expenses: Salaries and Wages Expense $ 43 , 000 Rent Expense 12 , 000 Advertising Expense 11 , 000 Supplies Expense 6 , 000 Utilities Expense 3 , 500 Insurance Expense 4 , 000 Total expenses 79 , 500 Net income (loss) $ ( 6 , 500 ) \begin{array}{lr} ext { Revenues } & & \$73,000 \ ext { Expenses: } & \ ext { Salaries and Wages Expense } & \$ 43,000 \ ext { Rent Expense } & 12,000 \ ext { Advertising Expense } & 11,000 \ ext { Supplies Expense } & 6,000 \ ext { Utilities Expense } & 3,500\ ext { Insurance Expense } & 4,000 \\quad ext { Total expenses } & & 79,500 \ ext { Net income (loss) } & & \$(6,500) \end{array} Revenues Expenses: Salaries and Wages Expense Rent Expense Advertising Expense Supplies Expense Utilities Expense Insurance Expense Total expenses Net income (loss) $43 , 000 12 , 000 11 , 000 6 , 000 3 , 500 4 , 000 $73 , 000 79 , 500 $ ( 6 , 500 ) After all closing entries have been posted the revenue account will have a balance ofA) $0.B) $73000 credit.C) $73000 debit.D) $6500 credit.

Question

The income statement for the year 2016 of Bugati Co. contains the following information:    Revenues  $ 73 , 000  Expenses:   Salaries and Wages Expense  $ 43 , 000  Rent Expense  12 , 000  Advertising Expense  11 , 000  Supplies Expense  6 , 000  Utilities Expense  3 , 500  Insurance Expense  4 , 000  Total expenses  79 , 500  Net income (loss)  $ ( 6 , 500 )  \begin{array}{lr}	ext { Revenues }  & & \$73,000 \	ext { Expenses: }  &  \	ext { Salaries and Wages Expense }  &  \$ 43,000 \	ext { Rent Expense }  & 12,000 \	ext { Advertising Expense }  &  11,000 \	ext { Supplies Expense }  & 6,000 \	ext { Utilities Expense } &  3,500\	ext { Insurance Expense } & 4,000  \\quad 	ext { Total expenses }  & & 79,500 \	ext { Net income (loss) }  & & \$(6,500) \end{array}  Revenues   Expenses:   Salaries and Wages Expense   Rent Expense   Advertising Expense   Supplies Expense   Utilities Expense   Insurance Expense   Total expenses   Net income (loss)  ​ $43 , 000 12 , 000 11 , 000 6 , 000 3 , 500 4 , 000 ​ $73 , 000 79 , 500 $ ( 6 , 500 )  ​ After all closing entries have been posted the revenue account will have a balance ofA)  $0.B)  $73000 credit.C)  $73000 debit.D)  $6500 credit.

Dalton Arbuckle · Accepted Answer

Final Answer : A, Explanation :  After all closing entries have been posted, the revenue account will have a balance of $0 because closing entries are made to transfer the balances of temporary accounts (like revenues, expenses, and dividends) to permanent accounts (like retained earnings), resetting the temporary accounts to zero for the next accounting period.

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