Why are adjusting entries needed at the end of an accounting period?
What is the difference between adjusting entries and correcting entries?
Identify the four different categories of adjusting entries frequently required at the end of an accounting period?
If the effect of the debit portion of an adjusting entry is to increase the balance of an asset account, which of the following statements describes the effect of the credit portion of the entry?
a. increases the balance of a revenue account
b. increases the balance of an expense account
c. increases the balance of a liability account
If the effect of the credit portion of an adjusting entry is to increase the balance of a liability account, which of the following statements describes the effect of the debit portion of the entry?
a. increases the balance of a revenue account
b. increases the balance of an expense account
c. increase the balance of an asset account
Does every adjusting entry have an effect on determining the amount of net income for a period? explain.
On November 1 of the current year a business paid the November rent on the building that it occupies. (a) Do the rights acquired at November 1 represent an asset or an expense? (b) What is the justification for debiting Rent Expense at the time of payment?
(a) Explain the purpose of the two accounts: Depreciation Expense and Accumulated Depreciation.
(b) What s the normal balance of each account?
(c) Is it customary for the balances of the two accounts to be equal in amount?
(d) In what financial statements, if any, will each account appear?