The Principal Purpose of Posting Is to

question 43

Multiple Choice

The principal purpose of posting is to

• A)help identify errors made in the journal.
• B)accumulate the effects of journalized transactions in the individual accounts.
• C)enter transactions directly into the general ledger.
• D)help determine if the financial statements are ready to be prepared.

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Definitions:

Adjusting Entries

Journal entries made at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred.

Financial Reports

Documents that contain detailed information about a company's financial health, performance, and cash flow over a specific period.

Prepaid Item

An expense paid in advance and recorded as an asset until it is actually used or consumed.

Adjusting Entry

Financial records established at the conclusion of an accounting term to assign earnings and costs to the period they truly belong.