Which One of the Following Is Not a Justification for Adjusting

question 49

Multiple Choice

Which one of the following is not a justification for adjusting entries?

• A) Adjusting entries are necessary to ensure that the revenue recognition principle is followed.
• B) Adjusting entries are necessary to ensure that the expense recognition principle is followed.
• C) Adjusting entries are necessary to enable financial statements to be in conformity with GAAP.
• D) Adjusting entries are necessary to bring the general ledger accounts in line with the budget.

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Definitions:

Produce

To manufacture, grow, or create goods and services for consumption or sale.

Transport

The movement of goods or people from one location to another using various modes such as road, rail, air, or sea.

Supply Curve

An illustration that depicts the connection between the cost of a commodity and the amount of the commodity that producers are prepared to offer.

Demand Curve

A graph showing the relationship between the quantity of a good that consumers are willing to buy and its price.