The following normal account balances were found on the general ledger before closing entries were prepared:
$$\begin{array} { | l | l | }
\hline \text { Revenue } \$ 900 & \text { Cash } \$ 500 \
\hline \text { Expenses } \$ 500 & \text { Accounts Receivable } \$ 350 \
\hline \text { Capital } \$ 7,500 & \text { Withdrawals } \$ 1,000 \
\hline
\end{array}$$
After closing entries are posted,what is the balance in the Revenue account?
A)$800
B)$0
C)$400
D)Closing entries do not affect Revenue.

Question

The following normal account balances were found on the general ledger before closing entries were prepared:
$$\begin{array} { | l | l | } 
\hline \text { Revenue } \$ 900 & \text { Cash } \$ 500 \
\hline \text { Expenses } \$ 500 & \text { Accounts Receivable } \$ 350 \
\hline \text { Capital } \$ 7,500 & \text { Withdrawals } \$ 1,000 \
\hline
\end{array}$$
After closing entries are posted,what is the balance in the Revenue account?
A)$800
B)$0
C)$400
D)Closing entries do not affect Revenue.

Quizplus · Accepted Answer

Closing entries transfer the balances of temporary accounts like Revenue to permanent accounts, resulting in a zero balance in the Revenue account.

The Following Normal Account Balances Were Found on the General