Mac's Accounting ch 10

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Closing entries reduce capital account balance to zero

The withdrawls account is closed with a credit to that account.

The income summary account serves as a simple income statement in the ledger

The temporary capital accounts start each fiscal period with a zero balance.

A compound entry has at least two debits and two credits.

A credit balance in the income summary account after the revenue, expese and withdrawls accounts have been closed indicates a net income

The income summary account does not have an increase or decrease side.

The income summary account has a normal credit balance.