Closing an Account Means

question 32

Multiple Choice

Closing an account means:

• A) reducing the balance to zero.
• B) transferring the balance to the trial balance.
• C) transferring the balance to the balance sheet.
• D) removing the account from the ledger.

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Definitions:

Sales Price

The amount of money for which a product or service is sold in the market.

Revenue In Full

The total amount of income generated by the sale of goods or services before any deductions are made.

Percentage-Of-Completion

An accounting method that recognizes revenues and expenses in proportion to the completion of a contracted work or project.

Economic Substance

The underlying economic reality of a transaction which determines its legal and tax implications, regardless of its form.