Net Earnings of a Corporation Should Be Closed to Retained

question 76

True/False

Net earnings of a corporation should be closed to retained earnings and net losses should be closed to share capital accounts.

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Definitions:

Plant Assets

Long-term tangible assets that are used in the operation of a business and are not intended for resale.

Depreciation Expense

Apportioning a physical asset’s cost over its estimated useful life.

Straight-Line Method

The straight-line method is a technique of allocating an asset's cost evenly throughout its useful life, commonly used for depreciation and amortization calculations.

Salvage Value

The approximated market price of an asset upon completing its useful life.