Adjusting Journal Entry
Barron's Accounting Dictionary:
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Adjusting Journal Entry
1. necessary entry at the end of the reporting period to record unrecognized revenue and expenses applicable to that period. It is required when a transaction is begun in one accounting period and concluded in a later one. An adjusting entry always involves an income statement account (revenue or expense) and a balance sheet account (asset or liability). The four basic types of adjusting entries relate to accrued expenses, accrued revenue, prepaid expenses, and unearned revenue.
2. correcting entry required at the end of the accounting period due to a mistake made in the accounting records; also called correcting entry. For example, if during the same year land was charged instead of travel expense, the correcting entry is to debit travel expense and credit land.
| Adjusted Gross Income (AGI), Adjusted Basis, Adjunct Account | |
| Adjustment, Administered Price, Administrative Accounting |
Investopedia Financial Dictionary:
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Adjusting Journal Entry
An entry in financial reporting that occurs at the end of a reporting period to record any unrecognized income or expenses for the period. When a transaction is started in one accounting period and finished in a later period, an adjusting journal entry is required to properly account for the transaction.
Adjusting journal entries can also refer to financial reporting that corrects a mistake made previously in the accounting period.
Also known as a "balance day adjustment."
Investopedia Says:
An adjusting journal entry involves an income statement account (revenue or expense) along with a balance sheet account (asset or liability) and typically relates to the accounts for accrued expenses, accrued revenue, prepaid expenses and unearned revenue.
When used to correct a previous accounting mistake, an adjusting journal entry usually involves a credit to one account and a debit to another account.
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Barron's Accounting Dictionary
Dictionary of Accounting Terms. Copyright © 2010 by Barron's Educational Series, Inc. All rights reserved.
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