Accounts That Are Used to Describe Assets, Liabilities, and Equity

question 124

Multiple Choice

Accounts that are used to describe assets, liabilities, and equity, that are not closed as long as the company continues to own the assets, owe the liabilities, or have equity, and whose balances appear on the balance sheet are called

• A) Summary accounts
• B) Temporary accounts
• C) Permanent accounts
• D) Contra accounts.
• E) Accrued accounts

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Definitions:

Futures Contract

A contract to purchase or sell a specified commodity or financial instrument at an agreed-upon price at a future date.

Credit Risk

The risk that the bond will not make all of its promised payments; default risk.

Swap Market

A market in which individuals, businesses, and institutions exchange financial instruments, like interest rates or currencies.

Fixed Rate

An interest rate that remains constant over the life of a loan or investment.