Closing the Temporary Accounts at the End of Each Accounting

question 7

Multiple Choice

Closing the temporary accounts at the end of each accounting period does all of the following except:

• A) Serves to transfer the effects of these accounts to the owner's capital account on the balance sheet.
• B) Prepares the withdrawals account for use in the next period.
• C) Causes owner's capital to reflect increases from revenues and decreases from expenses and withdrawals.
• D) Brings the revenue and expense accounts to zero balances.
• E) Has no effect on the owner's capital account.

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Definitions:

Contractual Rights

Rights that arise out of agreements between parties, granting specific entitlements or obligations as delineated in the contract.

Express Provision

An express provision is a clause or term in a contract or legal document that is explicitly stated, leaving no room for misunderstanding or interpretation.

Personal Nature

Characteristics or activities that belong to or are intended for a specific individual, often relating to private or intimate aspects of life.

Donee Beneficiary

In contract law, a person who benefits from a contract made between two other parties, where the intention is to gift the benefit or performance.