course.com E Menu QUESTION 3 Not complete Marked out of 200 PRag question Tempor

Question

course.com E Menu QUESTION 3 Not complete Marked out of 200 PRag question Temporary accounts: Select one: Have balances that are carried forward to the next accounting period O None of the above Have balances that are transferred to a permanent stockholders' equity account at the end of the accounting period O O Include accounts on both the balance sheet and the income statement Check QUESTION 4 Not complete Marke out of 2.00 rag question Which of the following is not an example of a closing entry? Select one: Close the Dividends account to the Retained Earnings account Close each expense account to the Retained Earnings account Close the Unearned Revenue account to the Retained Earnings account Close each revenue account to the Retained Earnings account Check CLICK HERE TO REVIEW LEARNING ORJECTIVES 19 FS F7

Explanation / Answer

Question 3

Correct Answer—Have Balances that are transferred to a permanent shareholder’s equity account at the end of the accounting period.

Explanation – Temporary accounts includes nominal accounts such as sales, salaries expense, wages expense, Rent expense, Service revenue, rent revenue, Interest revenue, depreciation expense etc.

In short all income and Expense accounts are temporary accounts which are transferred to Retained earnings account, Retained earnings is a part of Shareholder’s Equity.

Drawing is also a Temporary account which is transferred to capital account at the end of the year. For shareholder, drawing is taken as Dividends.

Question 4

Correct Answer—Close the Unearned Revenue account to retained earnings Account.

Explanation--- Unearned Service Revenue is a cash received in advance from customers. It is considered a current liability and shown in balance sheet hence not a temporary account to be closed.

Question 5

Answers

Accounts

Financial statement in which accounts appear

a

Cash

Balance Sheet

b

Sales

Income Statement

c

Accounts Payable

Balance Sheet

d

Unearned revenue

Balance Sheet

e

Retained Earnings

Balance Sheet

f

Interest Income

Income Statement

Explanation

Accounts

Financial statement in which accounts appear

Explanation

a

Cash

Balance Sheet

Cash is an Asset hence a part of balance sheet

b

Sales

Income Statement

Sales is a revenue account and shown in income statement.

c

Accounts Payable

Balance Sheet

Accounts payable is Current liability and shown on liability side of Balance sheet

d

Unearned revenue

Balance Sheet

It is cash received in advance hence a current liability shown in balance sheet.

e

Retained Earnings

Balance Sheet

Part of Shareholder's Equity, shown in balance sheet.

f

Interest Income

Income Statement

Interest is a nominal account and shown as other income in income statement.

Accounts

Financial statement in which accounts appear

a

Cash

Balance Sheet

b

Sales

Income Statement

c

Accounts Payable

Balance Sheet

d

Unearned revenue

Balance Sheet

e

Retained Earnings

Balance Sheet

f

Interest Income

Income Statement

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