Asked by Shiva Gupta on Jul 11, 2024
Verified
After posting the closing entries, which of the following accounts is most likely NOT to have a zero balance?
A) Prepaid Insurance Expense
B) Advertising Expense
C) J. Taylor, Withdrawals
D) Medical Fees Earned
Prepaid Insurance Expense
The portion of insurance premiums that have been paid in advance and are recognized as an asset until the insurance coverage relates to future periods.
Advertising Expense
Costs incurred in promoting products or services to attract sales or increase brand awareness.
Medical Fees Earned
Medical Fees Earned refers to revenue generated by healthcare providers for services rendered to patients.
- Differentiate between temporary and permanent accounts.
- Analyze the impact of closing entries on temporary and permanent accounts.
Verified Answer
BF
babar farooqJul 18, 2024
Final Answer :
A
Explanation :
Prepaid Insurance Expense is an asset account representing payments made in advance for insurance coverage, and it typically does not have a zero balance after posting closing entries because it reflects future insurance coverage periods.
Learning Objectives
- Differentiate between temporary and permanent accounts.
- Analyze the impact of closing entries on temporary and permanent accounts.