Is Income Summary An Asset Or An Equity Or A Retained Earnings (Short Questions And Answers)
Accounting Treatment Is Income Summary An Asset Income Summary is a Temporary Account and it is timely and temporarily prepared in order to close all of the temporary accounts (Revenues, Expenses, Gains and Losses) at the end of the accounting after all of the Financial Statements are prepared. So, it is not an asset account. Is Income Summary An Equity Account Income summary is not an equity account. Although it is considered as a temporary account, yet it is a temporarily part of equity account as it is closed to Retained Earnings Account which is also a part of equity account. Also, the closing balance of income summary account must be equal to the Net Profit Or Net Income or the Net Loss which is also the part of equity account, so it can be considered as a temporary part of equity account at the time when temporary accounts are closed, and also to show it as a part of Chart of Accounts but on permanent basis it is not an equity account. Is Income Summary The Same A...