Accounts That Are Used to Describe Revenues, Expenses, and Owner's

question 120

Multiple Choice

Accounts that are used to describe revenues, expenses, and owner's withdrawals, and are closed at the end of the reporting period, are

• A) Financial accounts
• B) Temporary accounts
• C) Closing accounts
• D) Permanent accounts
• E) Summary accounts

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Definitions:

Perpetual Inventory System

An inventory management system where updates to inventory records are made in real-time with each sale or purchase, providing a continuous record of inventory levels.

Discount Period

The timeframe during which a discount is offered for prompt payment on sales.

Merchandise Sold

The products that a retailer, wholesaler, or distributor has sold to customers during a specific period.

Gross Profit

The income left over for a company once it has covered the costs involved in manufacturing and selling its products, or in offering its services.