When closing the accounting period you:
A)Close temporary accounts at year end
B)Bring account balances up to date at year end
C)Close permanent accounts at year-end
D)All the above

Question

Quizplus · Accepted Answer

When closing the accounting period, the temporary accounts such as revenue, expenses, and dividends are closed or zeroed out to transfer their balances to the retained earnings account. This process is known as closing the temporary accounts or closing entries. Bringing account balances up to date and closing permanent accounts are ongoing processes throughout the year and not specific to year-end closing. Therefore, option A is the best choice as it correctly identifies the main task of closing the accounting period.

When Closing the Accounting Period You