Which of the following accounts would be closed at the end of the accounting period?
Practice Questions
1 question
Q1
Which of the following accounts would be closed at the end of the accounting period?
Cash
Accounts Receivable
Revenue
Equipment
Revenue accounts are temporary accounts that are closed at the end of the accounting period to prepare for the next period's transactions.
Questions & Step-by-step Solutions
1 item
Q
Q: Which of the following accounts would be closed at the end of the accounting period?
Solution: Revenue accounts are temporary accounts that are closed at the end of the accounting period to prepare for the next period's transactions.
Steps: 6
Step 1: Understand what an accounting period is. It is a specific time frame (like a month or a year) used for financial reporting.
Step 2: Learn about different types of accounts. There are two main types: temporary accounts and permanent accounts.
Step 3: Identify temporary accounts. These include revenue accounts, expense accounts, and dividend accounts. They are used to track financial activity for a specific period.
Step 4: Know that temporary accounts are closed at the end of the accounting period. This means their balances are reset to zero.
Step 5: Understand that permanent accounts, like assets and liabilities, are not closed. Their balances carry over to the next period.
Step 6: Conclude that revenue accounts are temporary accounts and will be closed at the end of the accounting period.
