Closing entries result in transfer of profit

Closing entries result in transfer of profit - true or false

Assignment Help Financial Accounting

Reference no: EM132814080

TRUE or FALSE.

Write TRUE if the statement is correct. Write FALSE if the statement is incorrect and identify the word/group of words that made the statement incorrect.

Question 1: The post-closing trial balance will have fewer accounts than then-adjusted trial balance.

Question 2: In the accounting cycle, closing entries are prepared before adjusting entries.

Question 3: After all closing entries have been entered and posted, the balance of the Income Summary account will be zero.

Question 4: A reversing entry is a journal entry which is the exact opposite of a related adjusting entry made at the end of the period.

Question 5: Closing entries clear income and expense accounts at the end of the period.

Question 6: Closing entries result in the transfer of profit or loss into the owner's Capital account.

Question 7: The final trial balance is called a post-closing trial balance.

Question 8: Nominal account balances are reduced to zero by closing entries.

Question 9: The post-closing trial balance contains asset, liability, withdrawal and capital accounts.

Question 10: The adjusting entries involving Rent Receivable and Salaries Payable could be reversed.

Reference no: EM132814080

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