Which one of the following general statements about closing entries is false -
A)only the asset and liability accounts may be closed
B)Sage 50 closes the appropriate accounts automatically when you start a new fiscal period
C)only the revenue and expense accounts may be closed
D)net income is closed to the retained earnings capital account

Question

Quizplus · Accepted Answer

The false statement is that only the asset and liability accounts may be closed. In fact, only the revenue and expense accounts may be closed at the end of an accounting period. Net income is then transferred to the retained earnings capital account. Sage 50 (or any other accounting software) may close the appropriate accounts automatically when a new fiscal period is started.

Which One of the Following General Statements About Closing Entries