Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

3. Accrual Accounting Concepts

Closing Entries

Financial Accounting

3. Accrual Accounting Concepts

Closing Entries

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Multiple Choice

Which of the following accounts is NOT generally closed at the end of the accounting cycle?

Service Revenue

Dividends

Salaries Expense

Retained Earnings

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Verified step by step guidance

Understand the concept of closing entries: Closing entries are made at the end of the accounting cycle to transfer the balances of temporary accounts (e.g., revenues, expenses, and dividends) to permanent accounts (e.g., Retained Earnings). Temporary accounts are reset to zero for the next accounting period.

Identify temporary accounts: Temporary accounts include Service Revenue, Dividends, and Salaries Expense. These accounts are closed because they pertain to a specific accounting period and need to start fresh in the next period.

Recognize permanent accounts: Permanent accounts, such as Retained Earnings, are not closed at the end of the accounting cycle. These accounts carry their balances forward to the next accounting period.

Analyze the question: The problem asks which account is NOT generally closed at the end of the accounting cycle. Based on the explanation above, Retained Earnings is a permanent account and is not closed.

Conclude the reasoning: Service Revenue, Dividends, and Salaries Expense are temporary accounts and are closed, while Retained Earnings is a permanent account and remains open, making it the correct answer to the question.