Asked by Kelly Cirella on Jul 16, 2024
Verified
Which of the following accounts should NOT be closed to Income Summary at the end of the fiscal year?
A) Salaries Expense
B) Fees Earned
C) Utilities Expense
D) Withdrawals
Withdrawals
Amounts of money taken out from a business by the owner(s) for personal use, not considered a business expense.
Fees Earned
Revenue generated from services provided or work completed during a specific period.
- Differentiate between enduring and transient accounts.
Verified Answer
CW
Candace WilliamsJul 21, 2024
Final Answer :
D
Explanation :
Withdrawals (or drawings) are not closed to the Income Summary account. Instead, they are directly closed to the owner's capital account because they represent amounts taken out of the business by the owner, not expenses or revenues of the business.
