399 Profit and Loss

Owner’s Equity

Net Worth

Synopsis

Account 399 is established to report the Profit or Loss of the dealership.

Debits

Credits

  1. Total of all costs of sales accounts at the end of the accounting year

  2. Total of all expense accounts at the end of the accounting year

  3. Total of all deductions from income accounts at the end of the accounting year

  4. Net profit at the end of the accounting year

  1. Total of all sales accounts at the end of the accounting year

  2. Total of all lease and rental income and sales accounts at the end of the accounting year

  3. Total of all additions to income accounts at the end of the accounting year

  4. Net loss at the end of the accounting year

 

Example 1

Record the transfer of the year end operating profit of $532,671 to retained earnings at the end of the accounting year.

Journal: General Journal

Entry:

 

Debit

Credit

Account 399

Profit or Loss

$532,671

 

Account 370

Retained Earnings

 

$532,671