Permanent accounts include which type of accounts?

Permanent accounts include which type of accounts?

• A. Revenue
• B. Expenses
• C. Retained Earnings
• D. Dividends

Answer: (C)

Permanent accounts are balance sheet accounts whose balances carry over into the next period. They include assets, liabilities, and equity. Retained Earnings is an equity account that stays on the books from one period to the next, so it is permanent. Revenue and expenses are temporary (they are closed to zero at period end), and dividends are a temporary account that is closed to Retained Earnings at year end and do not carry forward as a separate permanent balance. So the type that fits permanently is Retained Earnings.

Permanent accounts are balance sheet accounts whose balances carry over into the next period. They include assets, liabilities, and equity. Retained Earnings is an equity account that stays on the books from one period to the next, so it is permanent. Revenue and expenses are temporary (they are closed to zero at period end), and dividends are a temporary account that is closed to Retained Earnings at year end and do not carry forward as a separate permanent balance. So the type that fits permanently is Retained Earnings.