Which Of The Following Account's Balance Will Change Between The Adjusted Trial Balance And The Post-Closing Trial Balance?
The correct option of this multiple choice question (mcq) is D, as Retained Earnings are affected by Closing Entries. After the preparation of Adjusted Trial Balance, the closing entries are recorded to close all the Temporary Accounts (Revenues, Expenses, Dividends) and all the Permanent Accounts (Assets, Liabilities and Equity) are recorded in Post-Closing Trial Balance in order to transfer these accounts’ balances to the next accounting period. Net Income for the current accounting period and Dividends are transferred to Retained Earnings during closing entry process. Net income is added to opening retained earnings while dividends is deducted. If there is net loss, then it is deducted from beginning retained earnings. The final balance is ending retained earnings which is transferred to balance sheet under equity section. The option A i.e., Common Stock is not affected by closing entry process. It is an equity account which is transferred to post-closing trial balance. The o...