What does the closing process do in accounting?

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afm754

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The closing process is necessary in order to:

a. calculate net income or net loss for an accounting period.
b. ensure that all permanent accounts are closed to zero at the end of each accounting period.
c. ensure that the company complies with state laws.
d. ensure that net income or net loss and owner withdrawals for the period are closed into the owner's capital account.
e. ensure that management is aware of how well the company is operating.
 
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