An Adjusting Entry

question 127

Multiple Choice

An adjusting entry

• A) affects two balance sheet accounts.
• B) affects two income statement accounts.
• C) affects a balance sheet account and an income statement account.
• D) is always a compound entry.

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Definitions:

Investment Balance

Investment balance refers to the current value of an investor's portfolio, taking into account all the assets held, including stocks, bonds, and other investments.

Held To Maturity

A classification for financial securities which the holder intends and is able to keep until they mature.

Effective Yield

A measure of the return on an investment, accounting for the effect of compounding interest more accurately than nominal yield.

Interest Revenue

Income earned by a company for lending money or allowing another entity to use its funds, reported on the income statement.