What accounts is used only at the close of the merchandising cycle?

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1027123

2026-03-03 18:05

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The account primarily used at the close of the merchandising cycle is the "Income Summary" account. This account aggregates all revenues and expenses from the sales and cost of goods sold during the period, allowing businesses to determine their net income. After calculating the net income, the balance is then transferred to the retained earnings account in the equity section of the balance sheet, concluding the cycle.

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