Closing Which of These Accounts Results in a Credit to the Profit

question 5

Multiple Choice

Closing which of these accounts results in a credit to the profit or loss summary account?

• A) Sales
• B) Insurance expense
• C) Depreciation
• D) Drawings

---

Definitions:

Treynor Measures

Financial metrics used to assess the returns earned on a portfolio in excess of that which could have been earned on a risk-free investment, per each unit of market risk.

Sharpe Measure

A ratio developed by William F. Sharpe to measure risk-adjusted performance of an investment, calculating how much excess return you are receiving for the extra volatility that you endure for holding a riskier asset.

Dollar Weighted

A method of measuring investment returns which accounts for the size and timing of cash flows into and out of the portfolio.

Time Weighted

A method of calculating investment returns that eliminates the effects of cash inflows and outflows on the performance.