The closing account for Fees earned and Rent revenue is Profit or loss account.
Rent is the cash compensation for occupying a property of an owner for a specific period of time, the rental expense is paid by the occupier to the owner of the property.
The rent is paid monthly, semi annually or annually as per the agreed duration of time in the contract also the amount of the rent is also agreed and mentioned in the contract, the contract is a legal document and can be challenged in court of law if any party breaches the clause(s).
The fees earned and rental income is reflected in the other income head of the Profit or loss account and that is why its closing entry contains this account. The fees earned and the rental income is not reported directly in the statement of Financial position.
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