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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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Chapter
Section
BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

Multiple choice

Which of these types of accounts is considered a “permanent” account?

(a) Revenue

(b) Asset

(c) Drawing

(d) Expense

To determine

Identify the permanent account from the given types of accounts.

Explanation

Justification for the incorrect answer:

Option (a) is incorrect because revenue, expense, and owners’ drawings accounts are referred to as temporary accounts because the information and figures in these accounts is held temporarily and consequently transferred to permanent account at the end of accounting year.

Option (c) is incorrect because revenue, expense, and owners’ drawings accounts are referred to as temporary accounts because the information and figures in these accounts is held temporarily and consequently transferred to permanent account at the end of accounting year.

Option (d) is incorrect because revenue, expense, and owners’ drawings accounts are referred to as temporary accounts because the information and figures in these accounts is held temporarily and consequently transferred to permanent account at the end of accounting year...

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