Identify the nominal account
Correct answer: D. Rent expenses account
- A. Machinery account
- B. Building account
- C. Creditors account
- D. Rent expenses account
Explanation
Rent expense is a nominal account because it records an expense and is closed to the income statement at the end of the accounting period. Machinery and building are real accounts, while creditors is a personal account.
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About Accounting Principles
Accounting principles explain the rules used to record, classify and report business transactions. Coverage includes the accounting equation, double-entry system, accrual and cash bases, matching and prudence concepts, consistency, going concern, business entity, and the difference between capital and revenue items.
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