Closing entries are:
A) Required to bring all permanent accounts to a zero balance at the end of the accounting period
B) Not required to be posted
C) Required to bring all temporary accounts to a zero balance prior to starting a new accounting cycle
D) Generally taken from the financial statements rather than from the work sheet or the accounts themselves

Question

Quizplus · Accepted Answer

Closing entries are specifically designed to reset the balances of temporary accounts (revenues, expenses, and dividends) to zero at the end of an accounting period to prepare for the next period. Permanent accounts (assets, liabilities, and equity) are not closed and carry their balances forward into the next period.

Closing Entries Are