what-is-the-importance-of-the-cycle-of-closing-and-reopening-accounts-at-the-end

Question

What is the importance of the cycle of closing and reopening accounts at the end of an accounting period?

Accepted Answer

It ensures accurate financial reporting by resetting temporary accounts.

Answer

It allows for the preparation of the cash flow statement.

Answer

It provides a summary of all transactions for the period.

Answer

It helps in calculating the company's tax liability.