An Adjusting Entry Can Include A

question 130

Multiple Choice

An adjusting entry can include a:

• A)debit to an asset and a credit to a revenue.
• B)debit to a revenue and a credit to an asset.
• C)credit to an expense and a debit to a revenue.
• D)debit to an expense and a credit to a revenue.

---

Definitions:

Unadjusted Trial Balance

A preliminary report of all accounts in the general ledger before any adjusting entries are made to ensure debits equal credits.

Adjustments

Journal entries made to correct or update accounting records and financial statements, often at the end of an accounting period.

Prepayment of Expenses

The payment for goods or services before they are received or consumed, often recorded as an asset on the balance sheet until used.

Adjusting Entry

An accounting entry made at the end of an accounting period to allocate income and expenditure to the period in which they actually occurred, ensuring that financial statements reflect accurate and up-to-date information.