A closing entry may include a:
A)debit to Deferred Revenue.
B)credit to Interest Revenue.
C)credit to Wages Expense.
D)debit to Prepaid Insurance.

Question

Quizplus · Accepted Answer

The first closing entry debits each revenue account for the amount of its credit balance,credits each expense account for the amount of its debit balance,and records the difference in Retained Earnings.The second closing entry credits the Dividends account for the amount of its debit balance and debits Retained Earnings for the same amount.Assets (such as Prepaid Insurance)and liabilities (such as Deferred Revenue)are not closed at the end of the period.

A Closing Entry May Include A