Multiple Choice
Which of the following is typically prepared last in the accounting cycle?
22
views
3. Accrual Accounting Concepts
Post-Closing Trial Balance
Struggling with Financial Accounting?
Join thousands of students who trust us to help them ace their exams!Watch the first videoMultiple Choice
Which of the following accounts appear on the post-closing trial balance?
A
Only temporary accounts such as revenues and expenses
B
Only cash and capital accounts
C
Both permanent and temporary accounts
D
Only permanent accounts such as assets, liabilities, and owner's equity
Verified step by step guidance1
Understand the purpose of a post-closing trial balance: It is prepared after closing entries are made to ensure that the ledger is balanced and only permanent accounts remain open.
Recall the difference between temporary and permanent accounts: Temporary accounts (e.g., revenues, expenses, and dividends) are closed at the end of the accounting period, while permanent accounts (e.g., assets, liabilities, and owner's equity) carry their balances forward to the next period.
Identify the accounts that are closed: Temporary accounts are closed to the Income Summary account and then to the Retained Earnings or Capital account, leaving them with a zero balance.
Determine which accounts remain: Only permanent accounts, such as assets, liabilities, and owner's equity, appear on the post-closing trial balance because they are not closed and their balances are carried forward.
Conclude that the correct answer is: 'Only permanent accounts such as assets, liabilities, and owner's equity' because these are the accounts that remain open and are included in the post-closing trial balance.
2:33mWatch next
Master Post-Closing Trial Balance with a bite sized video explanation from Brian
Start learningRelated Videos
Related Practice
Post-Closing Trial Balance practice set
Problem sets built by lead tutorsExpert video explanations