Multiple Choice
Which of the following is NOT a balance sheet account?
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1. Introduction to Accounting
The Financial Statements
Multiple Choice
Which of the following accounts would NOT be reported on the balance sheet?
A
Accounts Receivable
B
Cash
C
Service Revenue
D
Retained Earnings
Verified step by step guidance1
Step 1: Understand the purpose of the balance sheet. The balance sheet reports a company's financial position at a specific point in time, showing assets, liabilities, and equity accounts.
Step 2: Identify which accounts are classified as assets, liabilities, or equity. For example, 'Accounts Receivable' and 'Cash' are asset accounts, while 'Retained Earnings' is an equity account.
Step 3: Recognize that revenue accounts, such as 'Service Revenue,' represent income earned during a period and are reported on the income statement, not the balance sheet.
Step 4: Confirm that 'Service Revenue' is not reported on the balance sheet because it is a temporary account closed to retained earnings at the end of the accounting period.
Step 5: Conclude that among the given options, 'Service Revenue' is the account that would NOT be reported on the balance sheet.
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