The correct option is b. accumulated depreciation.
Permanent accounts, also known as real accounts, do not require closing entries. These include asset, liability, and equity accounts. Examples are cash, accounts receivable, accounts payable, and retained earnings. These accounts carry their ending balances into the next accounting period and are not reset to zero.
In accounting, we often refer to the process of closing as closing the books. Only revenue, expense, and dividend accounts are closed—not asset, liability, Common Stock, or Retained Earnings accounts.
Permanent Accounts
These accounts do not get closed at the end of an accounting period.
The accounts that do not get closed (their balances are carried forward to the next accounting year) are referred to as permanent accounts. The balance sheet accounts are permanent accounts.
Permanent accounts are balance sheet accounts that are not closed at the end of an accounting period. The balances of these accounts are not reset to zero at the end of each accounting period but instead, carry forward continuously to subsequent accounting periods.
Conclude that the correct answer is Owner's Capital, as it is the account that is NOT closed at the end of the accounting period.
A closing entry is a journal entry that is made at the end of an accounting period to transfer balances from a temporary account to a permanent account. Companies use closing entries to reset the balances of temporary accounts − accounts that show balances over a single accounting period − to zero.
Dividends does not appear in the post-closing trial balance. Thus, choice D is the correct answer.
Accounts Receivable is not closed because this is a balance sheet account which are accumulating or updating.
7 Essential Accounting Journal Entries That Transform Financial Record-Keeping
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.
Conclude which account does NOT appear in a closing entry: Accounts Payable is a permanent account and does not appear in closing entries because its balance is not transferred or closed at the end of the period.
Only temporary accounts get closed at the end of an accounting period. Permanent account balances don't close at the end of an accounting period. Instead, permanent accounts maintain cumulative balances that get carried over from one period to another.
Answer to Question No. 19 Option D i.e. Dividend. Revenue and Expenses don't have any balance after Closing Entries. Dividend is an expense account.
Answer and Explanation:
Among the four choices, the assets, liabilities and common stock accounts are not closed at the end of the reporting period. These accounts are called as permanent accounts and are presented in the post-closing trial balance and in the balance sheet.