Under a Perpetual Inventory System, Which Accounts Would Be Closed

question 162

Multiple Choice

Under a perpetual inventory system, which accounts would be closed to Income Summary with credits?

• A)Sales Returns and Allowances, Sales Revenue, and Inventory
• B)Sales Discounts, Sales Returns and Allowances, and Cost of Goods Sold
• C)Sales Revenue and Cost of Goods Sold
• D)Sales Returns and Allowances and Sales Revenue

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Definitions:

Semi-Annual Deposits

Deposits made twice a year into a financial account or investment vehicle.

Compounded Quarterly

Refers to the process of calculating interest on both the initial principal and the accumulated interest from previous periods on a quarterly basis.

Compounded Semi-Annually

Interest that is computed and added to the principal twice a year, allowing the investment to grow more rapidly.

Future Value

The value of a current asset at a specified date in the future based on an assumed rate of growth.