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A company closes all of its temporary accounts in order to zero out the balances so that next period starts with a fresh slate. To
A company closes all of its temporary accounts in order to zero out the balances so that next period starts with a fresh slate. To close revenue accounts, a company must increase (credit) Retained Eamings and decrease (debit) Revenue. To close expense accounts, a company must decrease Retained Eamings and decrease expense account. Similarly, a company must increase Retained Earnings and decrease dividend accoun True Falss
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