The Law Dictionary

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NOMINAL ACCOUNT Definition & Legal Meaning

Definition & Citations:

Period-ending at near-zero balanced revenue or expense account as an owners’ equity account subdivision. A zero balance at the beginning of a new accounting period, accumulates balances during the period, and at zero at the year end by means of closing entries is the characteristic of this type of account. In contrast to balance sheet accounts known as ‘permanent accounts’ or ‘real accounts’, this is an income statement account known as a ‘temporary account’.


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