Asked by Annie Vatterott on Jun 29, 2024
Verified
Closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period.
Closing Revenue
Closing Revenue typically refers to the total revenue recognized by a company at the end of a financial period.
Expense Accounts
Categories within financial accounting that track money spent or costs incurred by a company in its operational activities.
Accounting Period
A specific duration of time used for financial reporting purposes, typically a quarter or a year.
- Acquire insight into the critical role and steps of making closing entries in re-establishing temporary accounts for the upcoming accounting term.
Verified Answer
SM
Sabrina MirzaevaJul 03, 2024
Final Answer :
True
Explanation :
Closing revenue and expense accounts transfers their balances to the retained earnings account, allowing the revenue and expense accounts to start fresh in the next accounting period.
Learning Objectives
- Acquire insight into the critical role and steps of making closing entries in re-establishing temporary accounts for the upcoming accounting term.