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Adjusting entries are needed because transactions made at different times. For example, we purchase a computer on account for $1500 on March 5, at the time of the transaction we record the entry as
March 5
Equipment-Computer (debit) $1500
Accounts Payable (credit) $1500
later in say the month, we may make a payment to this account, we need to "adjust" these accounts to show the current state of them. Say on March 20, we make a payment of $500 on the account, we have to show this adjustment by doing the following adjusting entries.
March 20
Accounts Payable (debit) $500
Cash (credit) $500
This adjusting entry reflects what we now owe to the account payable, with out the adjusting entry, our books would still be showing that we owe the full amount even though we paid part of it.
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Adjusting entries are primarily needed for?
cash basis accounting
Why are adjusting entries needed at the end of accounting period?
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. This is in sharp contrast to entries during the accounting period (such as utility bills or fees for services rendered) that depend on source documents.
Why are adjusting entries needed at the end of an accounting period?
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. This is in sharp contrast to entries during the accounting period (such as utility bills or fees for services rendered) that depend on source documents.
When would you enter a general journal adjustments in an accounting package?
General journal entries are transactions that you use to track general expenses. You would enter a general journal adjustment in an accounting package for a special situation only.
How many entries are needed for each accounting transaction?
There must be always a 'Credit' whenever there is a 'Debit' so there must be 2.
What is adjustment entries?
Adjusting entries are journal entries which are normally made to allocate income or expenditure to the accounting period in which they actually occured.
Adjusting entries are primarily needed for?
cash basis accounting
Why are adjusting entries needed at the end of accounting period?
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. This is in sharp contrast to entries during the accounting period (such as utility bills or fees for services rendered) that depend on source documents.
Why are adjusting entries needed at the end of an accounting period?
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. This is in sharp contrast to entries during the accounting period (such as utility bills or fees for services rendered) that depend on source documents.
When would you enter a general journal adjustments in an accounting package?
General journal entries are transactions that you use to track general expenses. You would enter a general journal adjustment in an accounting package for a special situation only.
How many entries are needed for each accounting transaction?
There must be always a 'Credit' whenever there is a 'Debit' so there must be 2.
Define and distinguish between entries on the books and entries on the workpapers and explain why such an entries on the books and on the workpapers are required in the consolidation process?
what is distinguish between bookkeeping and accounting? what is distinguish between bookkeeping and accounting? what is distinguish between bookkeeping and accounting?
How do you correct errors in accounting?
To rectify the errors in accounting adjusting entries are made to adjust the amount in any transaction or reversing the original entries etc.
What transactions might not require reversing entries?
What transactions in accounting might not require reversing entries
What transactions might require reverse entries?
What transactions in accounting might not require reversing entries
Why are closing entries required at the end of an accounting period?
The closing entries in an accounting period are important because they will be used as opening entries in the next period. They help people to calculate the balances and accruals of a predetermined period.
What are the journal entries that bring the accounts up to date at the end of the accounting period called?
closing entries
