An account whose balance is transferred to the capital account at the end of an accounting period is a temporary account.

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Temporary accounts are used to track income, expenses, gains, and losses for a specific accounting period, and their balances are transferred to the capital account at the end of that period. Examples of temporary accounts include revenue, cost of goods sold, and operating expenses. In contrast, permanent accounts (such as assets, liabilities, and equity) retain their balances from one accounting period to the next.

An Account Whose Balance Is Transferred to the Capital Account