Asked by Adrian Barrera on May 19, 2024
Verified
Which of the following account balances would not be affected by closing entries?
A) Interest expense.
B) Accumulated depreciation.
C) Treasury stock.
D) Retained earnings.
Treasury Stock
An alternative term for treasury shares, referring to stocks that a company has repurchased and holds, reducing the amount of outstanding stock on the market.
Closing Entries
Made at the end of the accounting period to transfer balances in temporary (income statement) accounts to Retained Earnings and to establish a zero balance in each of the temporary accounts for beginning the next accounting period.
Account Balances
The total amount of money in an account at a certain point in time, which can represent assets or liabilities depending on the account type.
- Distinguish between permanent and temporary accounts and their roles in the accounting cycle.
- Identify accounts that are affected by closing entries and those that are not.
Verified Answer
Learning Objectives
- Distinguish between permanent and temporary accounts and their roles in the accounting cycle.
- Identify accounts that are affected by closing entries and those that are not.
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