When closing entries are made:

Multiple Choice:

a) All asset accounts are closed but liability accounts are not closed.

b) All permanent accounts are closed but temporary accounts are not closed.

c) All balance sheet accounts are closed.

d) All ledger accounts are closed to start the new accounting period.

e) All temporary accounts are closed but permanent accounts are not closed.

Question

Cael Page

Business

Yesterday, 23:47

When closing entries are made:

Multiple Choice:

a) All asset accounts are closed but liability accounts are not closed.

b) All permanent accounts are closed but temporary accounts are not closed.

c) All balance sheet accounts are closed.

d) All ledger accounts are closed to start the new accounting period.

e) All temporary accounts are closed but permanent accounts are not closed.

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Answers (1)

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Jaylan Levy · Answer 1

e) All temporary accounts are closed but permanent accounts are not closed.

Explanation:

At the time of the closing entries, the temporary accounts are closed instead of all other accounts. The temporary accounts include revenues account, expenses account, dividend paid account, ultimately income summary account

These accounts are closed so that the amount of these accounts should be carried forward to the next accounting period. The amount would always be zero, And in every accounting period, these accounts are closed.