Which of the following is true regarding closing entries?

Accounting Mcqs 24/11/2020

A. They must be followed by reversing entries
B. They transfer the balances in all of the Nominal Accounts to the Trading and Profit and Loss Account
C. They must be made after the reversing entries but before the adjusting entries
D. They must be made after the adjusting entries but before the reversing entries

Closing entries are required to transfer the nominal accounts to the Profit & Loss Account and the Trading account. Real accounts and personal account are not closed to Profit & Loss Account or Trading Account. Their balance is carried in the Balance Sheet and appears as opening Balance in the next accounting period.

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