Company Throughput Accounting Treasury Management Ultimate Accountants' Reference Vest Pocket GAAP Vest Pocket IFRS Newsletter Sign Up Your E-Mail Address * Subscribers receive a monthly discount on accounting books « What is the residual income approach? | Main | What is the operating profit margin? » What is the income summary account? Saturday, March 26, 2011 at 12:23PM The income summary account is a transitional account into which all income statement revenue and expense accounts are transferred at the end of an accounting period. The net amount transferred into the income summary account equals the net profit or loss that the business incurred during the period. Thus, shifting revenue out of the income statement means debiting the revenue account for the total amount of revenue recorded in the period, and crediting the income summary account. Likewise, shifting expenses out of the income statement requires you to credit all of the expense accounts for the total amount of expenses recorded in the period, and debit the income summary account. This is the first step you would take in using the income summary account. ]