Which of the following accounts should be closed to Retained Earnings at the end of the fiscal year?
A)Service Revenue
B)Equipment
C)Prepaid Insurance
D)Unearned Rent

Question

Quizplus · Accepted Answer

Service Revenue is closed to Retained Earnings at the end of the fiscal year because it is an income statement account, and all income statement accounts (revenues, expenses, gains, losses) are closed to Retained Earnings to reflect the period's net income or loss. Equipment and Prepaid Insurance are asset accounts, and Unearned Rent is a liability account; none of these are closed to Retained Earnings.

Which of the Following Accounts Should Be Closed to Retained