Which Statement Relating to Closing Entries Is Incorrect

question 44

Multiple Choice

Which statement relating to closing entries is incorrect?

• A) The closing process is simple with a computerised accounting system.
• B) Closing entries are only made once a year.
• C) Closing entries are made each time a trial balance is prepared.
• D) The need for closing entries arises from the accounting period assumption.

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Definitions:

Downstream Firms

Companies positioned at the end stages of supply chains, engaging in the processing or selling of final products to customers.

Market Power

The ability of a company or entity to influence the price and output levels in the market.

Double-Markup Problem

A situation in vertical supply chains wherein two or more successive stages (like wholesalers and retailers) mark up the prices of goods, potentially leading to excessively high retail prices.

Vertical Relationships

The interactions and connections between different levels of a supply chain, such as manufacturers and distributors.