Question: Which of the following is an example of a temporary account?
Options:
Cash
Accounts Receivable
Revenue
Retained Earnings
Correct Answer: Revenue
Solution:
Revenue is a temporary account that is closed at the end of the accounting period.
Which of the following is an example of a temporary account?
Practice Questions
Q1
Which of the following is an example of a temporary account?
Cash
Accounts Receivable
Revenue
Retained Earnings
Questions & Step-by-Step Solutions
Which of the following is an example of a temporary account?
Step 1: Understand what a temporary account is. Temporary accounts are used to track financial activity for a specific period of time.
Step 2: Identify examples of temporary accounts. Common examples include revenue, expenses, and dividends.
Step 3: Know that temporary accounts are closed at the end of each accounting period. This means their balances are reset to zero for the next period.
Step 4: Recognize that revenue is a type of temporary account because it tracks income earned during a specific period and is closed at the end of that period.
No concepts available.
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