Which of the Following Accounts Should Be Closed to Retained

question 233

Multiple Choice

Which of the following accounts should be closed to Retained Earnings at the end of the fiscal year?

• A) Inventory
• B) Accumulated Depreciation
• C) Customer Refunds Payable
• D) Cost of Goods Sold

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Definitions:

Accounting Principles

Fundamental guidelines or rules that govern the field of accounting and ensure the accuracy and consistency of financial statements.

Accrued Revenues

Income recognized on the income statement but not yet received in cash or recorded by the company.

Prepaid Costs

Payments made beforehand for products or services that will be delivered at a later date.

Expired Cost

A cost that has been incurred and recognized as an expense, reflecting the consumption of an asset or a service in generating revenue.