Closing Entries

question 67

Multiple Choice

Closing entries

• A) need not be journalized if adjusting entries are prepared
• B) need not be posted if the financial statements are prepared from the end-of-period spreadsheet
• C) are not needed if adjusting entries are prepared
• D) must be journalized and posted

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Definitions:

Money Market Account

A type of savings account that typically offers higher interest rates, with some restrictions on withdrawal.

Cash Surplus

The amount of cash that exceeds the cash needs of a company, indicating a positive financial state with excess liquidity.

Major Expenditure

A significant financial outlay, often relating to the purchase of fixed assets, long-term investments, or other large-scale business expenses.

Lockbox Arrangement

A service provided by banks to process payments quickly by having checks sent to a special post office box.