Asked Sep 19, 2019

Are all of the accounts on a balance sheet considered permanent including dividends? Dividends are considered an account in this question. Thank you.


Expert Answer

Step 1

Account: A record which documents or records the changes in assets, liabilities, or equity for a particular period is referred to as an account.

Step 2

Permanent or Real accounts: The accounts which are not closed at the end of fiscal period, but the balances are retained and carried forward to next fiscal period are referred to as real accounts or permanent accounts. All assets, liabilities, stockholders’ equity, and capital accounts are real accounts. Accounts Receivable (asset), Cash (asset), Inventory (asset), Accounts Payable (liability), Wages Payable (liability), Notes Payable (liability), Retained Earnings (stockholders’ equity) and Capital (stockholders’ equity) accounts are few examples ...

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