The closing process includes which of the following?

Question

Quizplus · Accepted Answer

The closing process involves closing the balances of the revenue, expense, and dividend accounts to zero. This is done to prepare the accounts for the next accounting period and to ensure that the retained earnings account reflects the current year's net income. Only closing the balance of the retained earnings account to zero (A) or only closing the balances of revenue and expense accounts to zero (C) would not accurately reflect the company's financial performance and may cause errors in future accounting periods. Closing only the dividends account to zero (B) would not be sufficient for the closing process as it does not address the revenue and expense accounts.

The Closing Process Includes Which of the Following