The debit to Income Summary in the second closing entry ...

[jCorn1234]

The debit to Income Summary in the second closing entry represents the total expenses.
 a. True
   b. False
   Indicate whether the statement is true or false

Question 2

Describe the relationship between the FASB and the SEC.
 
  What will be an ideal response?

[IAPPLET]

Answer to Question 1

True

Answer to Question 2

The FASB and the SEC work closely together in the development of accounting policy, with the SEC playing largely a supportive role. Pressures from the private sector have caused controversy at times. Congress has given accounting rulemaking authority to the SEC, who, in turn, has passed that role to the FASB. The SEC maintains veto power over any rule written by the FASB. Reporting companies must use the rules written by both the SEC and the FASB and if these companies do not like the rules they will most likely lobby their congressmen to force the SEC to change those rules.