Asked by Loretta Foshee on Jul 13, 2024
Verified
Which one of the following accounts shows a balance on the post-closing trial balance?
A) Interest Expense
B) Service Revenue
C) Retained Earnings, beginning of the year
D) Common Shares
Post-closing Trial Balance
A list of all accounts still open after closing entries are made, used to verify the equality of debits and credits.
Retained Earnings
The portion of net income that is kept by the company rather than distributed to shareholders in the form of dividends to be reinvested in the business or pay off debt.
- Differentiate between permanent and temporary accounts and their treatment at the end of the accounting period.
- Recognize the importance and components of the post-closing trial balance.
Verified Answer
AP
Anthony PiazzaJul 17, 2024
Final Answer :
D
Explanation :
Retained Earnings, beginning of the year, would not typically appear on a post-closing trial balance as it is updated to reflect the end-of-year balance after closing entries. Interest Expense and Service Revenue accounts are temporary accounts that would have been closed to Retained Earnings at the end of the accounting period. Common Shares is a permanent account that reflects the equity of shareholders and remains on the post-closing trial balance.
Learning Objectives
- Differentiate between permanent and temporary accounts and their treatment at the end of the accounting period.
- Recognize the importance and components of the post-closing trial balance.
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