1. A merchandiser uses a perpetual inventory system. The third step in the proce

Q: 1. A merchandiser uses a perpetual inventory system. The third step in the proce

1. Answer is "C. make the Income Summary account equal to zero via the Owner, Capital account" In the first two steps, the debit and credits of the income statement are amde zero via income summary account. In the third step, the balance in income summary account is tranferred to Owner's capital account. 2. Answer is "D. quickly an asset may be converted into cash."

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Question

1. A merchandiser uses a perpetual inventory system. The third step in the process of closing the accounts of a merchandiser is to ________.

Liquidity is a measure of how ________.

quickly an asset may be converted into cash

A. make the revenue accounts equal to zero via the Income Summary account B. make the Income Summary account equal to zero via the Owner, Withdrawals account C. make the Income Summary account equal to zero via the Owner, Capital account D. make the expense accounts equal to zero via the Income Summary account

Explanation / Answer

Answer is "C. make the Income Summary account equal to zero via the Owner, Capital account"

In the first two steps, the debit and credits of the income statement are amde zero via income summary account. In the third step, the balance in income summary account is tranferred to Owner's capital account.

Answer is "D. quickly an asset may be converted into cash."

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1. A merchandiser uses a perpetual inventory system. The third step in the proce

1. A merchandiser\'s statement of retained earnings looks exactly like that of a

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1. A merchandiser uses a perpetual inventory system. The third step in the proce

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