Which of the following is not true about closing entries?
A)There are two closing entries that update the retained earnings account.
B)The closing entries are dated the last day of the accounting period.
C)All real accounts are closed at the end of the period.
D)By closing nominal accounts at the end of the period to zero, it is possible to isolate next period's information correctly.

Question

Quizplus · Accepted Answer

Real accounts, also known as permanent accounts, are not closed at the end of the accounting period. Only nominal accounts (temporary accounts) such as revenues, expenses, and dividends are closed to prepare the accounts for the next period. Real accounts, like asset, liability, and equity accounts, carry their balances over to the next period.

Which of the Following Is Not True About Closing Entries