Explain the differences between permanent and temporary accounts and identify which types of accounts must be closed at the end of a company's fiscal year. Recall your business type from Week 1(freelance software development company). For your business, identify at least 3 permanent and 3 temporary accounts your business would have and explain why each account is classified as such. Once closing entirety have been entered in the general journal and posted to the ledger, what is the effect on the owner's capital (or retained earnings) account? Explain the purpose of a post-closing trial balance in your own words and answer this question: is the post-closing trial balance mandatory as a step in the accounting cycle? Assuming a company's first year-end, would financial statements be affected if the closing process were not completed? Explain.

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Answer Differences between temporary accounts and permanent accounts Temporary Accounts Permanent Accounts These accounts are closed during an account... View the full answer