Entries Required to Zero the Balances of the Temporary Accounts

question 34

Multiple Choice

Entries required to zero the balances of the temporary accounts at the end of the year are called

• A) posting entries.
• B) adjusting entries.
• C) closing entries.
• D) correcting entries.

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Definitions:

WACC

The Weighted Average Cost of Capital represents a computation that determines a company's capital costs, with each type of capital being weighted according to its proportion.

Tax Adjustment

Modifications made to income or tax liability due to deductions, exemptions, and credits to comply with tax regulations or to benefit from them.

Interest Paid

The amount of money paid by a borrower to a lender in exchange for the use of borrowed money.

Target Capital Structure

The optimal mix of debt, equity, and other financing sources that a company aims to achieve to minimize cost of capital and maximize shareholder value.