[amp_mcq option1=”It is a nominal account” option2=”All cash and credit items are shown” option3=”It begins with credit balance” option4=”The closing balance indicates cash balance” correct=”option1″]<\/p>\n
The correct answer is: A. It is a nominal account.<\/p>\n
A receipt and payment account is a type of nominal account. Nominal accounts are used to record income and expenses for a specific period of time, such as a month or a year. The closing balance of a nominal account is transferred to the profit and loss account, which is then used to calculate the net profit or loss for the period.<\/p>\n
Option B is incorrect because receipt and payment accounts do not show all cash and credit items. Only items that are related to income and expenses are recorded in a receipt and payment account.<\/p>\n
Option C is incorrect because receipt and payment accounts do not begin with a credit balance. They begin with a debit balance, which represents the opening balance of cash.<\/p>\n
Option D is incorrect because the closing balance of a receipt and payment account does not indicate the cash balance. The closing balance of a receipt and payment account is transferred to the profit and loss account, which is then used to calculate the net profit or loss for the period.<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”It is a nominal account” option2=”All cash and credit items are shown” option3=”It begins with credit balance” option4=”The closing balance indicates cash balance” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[],"class_list":["post-58481","post","type-post","status-publish","format-standard","hentry","category-accounting","no-featured-image-padding"],"yoast_head":"\n