Which Account Will Be Included in the Closing Entries for Both

question 200

Multiple Choice

Which account will be included in the closing entries for both service and merchandising companies?

• A)Sales
• B)Cost of Merchandise Sold
• C)Purchase Discounts
• D)Purchase Returns and Allowances

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Definitions:

Ratification

The action of formally confirming or approving an agreement, treaty, or contract, making it officially valid.

Authority

The legal right or power to make decisions, enforce rules, or command obedience.

Principal

In a legal context, a principal can also refer to the person who has authorized another (an agent) to act on their behalf.

Apparent Authority

A situation where a person appears to have the authority to act on behalf of another, even if such authority has not been explicitly given.