Revenue and expenses are added together, then set back to zero. Any difference between them (your profit or loss) is added to the equity account chosen under Account Assignments.

For example, if you had 95,000 in revenue (tuition charged, etc.) less 80,000 in expenses (payroll and payments to vendors) you’d end up with 15,000 in profit for the year (equity), while revenue and expenses would be reset to zero.

See also: Calculate Beginning Balances