The matching principle that is applied in accrual accounting requires that adjusting entries are made to the accounts to ensure that all the revenue earned in an accounting period together with all the expenses incurred in earning that revenue, are recorded and reported in the same accounting period. (c) balance sheet and income statement accounts have correct balances at the end of an accounting period. Adjusting entries are made to ensure that: A. expenses are recognized in the period in which they are incurred. It also adheres the accrual basis accounting and cash basis accounting and it must follow the … Accrued expenses require adjusting entries. b. revenues are recorded in the period in which services are performed. As per the accrual concept, a company should recognize income when it earns and not when it receives. To ensure that financial statements reflect the revenues that have been earned and the expenses that were incurred during the accounting period, adjusting entries are made on the last of an accounting period. “Adjusting entries are needed to ensure that the revenue recognition and matching principles... 3 Pages (750 words) Assignment. Adjusting entries. The purpose of adjusting entries is to ensure that your financial statements will reflect accurate data. This is the fourth step in the accounting cycle. Adjusting entries are made to ensure that: (a) expenses are recognized in the period in which they are incurred. b. revenues are recorded in the period in which services are performed. O all of these answer choices are correct. C) balance sheet and income statement accounts have correct balances at the end of an accounting period. 15) Corrections are entries made to correct errors found in A) all journals. b. revenues are recorded in the period in which the performance obligation is satisfied. Adjusting entries are those accounting entries which are passed at the end of the accounting period. c. balance sheet and income statement accounts have correct balances at the end of an accounting period. Adjusting entries are made at the end of the accounting period before the financial statements to make sure the accounting records and financial statements are up-to-date. O revenues are recorded in the period in which the performance obligation is satisfied. b. revenues are recorded in the period in which they are earned. Before financial statements are prepared, additional journal entries, called adjusting entries, are made to ensure that the company’s financial records adhere to the revenue recognition and matching principles. (b) revenues are recorded in the period in which services are provided. 2.5.1 Accrued Expenses. Adjusting entries are need because: An expense has been incurred but not yet recorded; D) estimates. d. All of the above. In this case someone is already performing a service for you but you have not paid them or recorded any journal entry yet. This means that all the entries and adjustments neccessary have been made in the account and it has been presented. C) deferrals. D. Answer & Explanation: First – entries for the adjustments: 1. B) revenues are recorded in the period in which they are earned. d. all of the above. Chapter 3-14 SO 3 Explain the reasons for adjusting entries. c. balance sheet and income statement accounts have correct balances at the end of an accounting period. Question The Need for Adjusting Entries Adjusting entries are made to ensure that: Select one: a. expenses are recognized in the period in which they are incurred. Before financial statements are ready, extra journal entries, referred to as adjusting entries, are made to ensure that the company’s monetary data adhere to the revenue recognition and matching principles. They can however be made at the end of a quarter, a month or even at the end of a day depending on the accounting requirement and the nature of business carried on by the company. Adjusting entries are usually made at the end of an accounting period. The entries made to update the financial records, are regarded as, adjusting entries. These entries produce an impact on at least a single income statement on the financial records and a single balance sheet. In summary, adjusting entries are usually made at the end of an accounting period. Answer: B Objective: Learning Objective 1 Difficulty: Easy AACSB: Analytic. b. revenues are recorded in the period in which they are earned. Adjusting entries are made to ensure that income and expenditure is allocated to the correct accounting period, this means that the accounting records are completed on an accruals basis and are in compliance with the matching principle. Adjusting Entries; Adjusting entries are passed in order to comply with accrual basis of accounting. The adjustments made in journal entries are carried over to the general ledger which flows through to the financial statements. Before financial statements are prepared, additional journal entries, called adjusting entries, are made to ensure that the company’s financial records adhere to the revenue recognition and matching principles. (b) revenues are recorded in the period in which ser- vices are performed. In order for an organization’s monetary statements to include these transactions, accrual-sort adjusting entries are needed. Adjusting entries are made to ensure that: a. expenses are recognized in the period in which they are incurred. Additional accounts are: Depreciation Expense, Insurance Expense, Interest Payable, and Supplies Expense. B. revenues are recorded in the period in which they are earned. The presentation of finacial statement should be true and fair. ContentExploring The Most Common Adjusting EntriesThe Purpose Of Adjusting Entries:Composition Of An Adjusting EntryHow To Make Adjusting EntriesUnderstanding Account adjustments, also known as adjusting entries, are entries that are made in the general journal at the end of an accounting period to bring account balances up-to-date. Timing Issues Review Adjusting entries are made to ensure that: a. expenses are recognized in the period in which they are incurred. Adjusting entries are made to ensure that the part that has occurred during a particular month appears on that same month’s financial statements. This is to ensure that revenues and expenses are recognized in the accounts in the month to which they relate. Adjusting entries are made to ensure that: a. expenses are recognized in the period in which they are incurred. Adjusting Entries are journal entries that are made at the end of the accounting period, to adjust expenses and revenues to the accounting period where they actually occurred.Generally speaking, they are adjustments based on reality, not on a source document. Task: prepare the adjusting entries at March 31, assuming that adjusting entries are made quarterly. Adjusting entries are made to ensure that a expenses are recognized in the from ACCT 201 at Palomar College (b) revenues are recorded in the period in which services are performed. Last … c. During the financial close process, a number of journal entries are made to ensure that the income statement and balance sheet comply with GAAP, with particular emphasis on ensuring: 1) revenues / expenses are in the proper period, and 2) items on the balance sheet are properly valued. Adjusting entries are made at the end of an accounting period after a trial balance is prepared to adjust the revenues and expenses for the period in which they occurred. These entries are made to align the books of accounts to the matching concept and accrual principles laid down by accounting standards. Adjusting entries are made to ensure that: (a) expenses are recognized in the period in which they are incurred. Adjusting entries are made to ensure that: (a) expenses are recognized in the period in which they are incurred. 14) Adjusting entries that are made to counteract the effects of errors found in the general ledger are called A) accruals. B) special journals. b. revenues are recorded in the period in which the performance obligation is satisfied. O balance sheet and income statement accounts have correct balances at the end of an accounting period. c. balance sheet and income statement accounts have correct balances at the end of an accounting period. Adjusting entries must involve two or more accounts and one of those accounts will be a balance sheet account and the other account will be an income statement account. C. statement of financial position and income statement accounts have correct balances at the end of an accounting period. Question: Adjusting Entries Are Made To Ensure That: ?a) Expenses Are Recognized In The Period In Which They Are Incurred B) Revenues Are Recorded In The Period In Which The Performance Obligation Is Satisfied C) Balance Sheet And Income Statement Accounts Have Correct Balances At The End Of An Accounting Period D) All Of The Above Adjusting entries are made to ensure that: a. expense are recognized in the period in which they are incurred. These are necessary entries to present a true and fair view of financial information. B) corrections. Note that the ending balance in the asset Prepaid Insurance is now $600—the correct amount of insurance that has been paid in advance. 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