Select the Statement That Best Describes the Primary Purpose of Preparing

Multiple Choice

Select the statement that best describes the primary purpose of preparing closing entries.

A) To reduce the balances of revenue and expense accounts to zero so that they may be used to accumulate the revenues and expenses of the next period.
B) To complete the recording of various transactions which are begun in one period and concluded in a later period.
C) To determine the amount of profit or loss for the period.
D) To facilitate adjusting entries.