An Adjusting Entry Always Affects

question 108

Multiple Choice

An adjusting entry always affects

• A) balance sheet accounts only.
• B) income statement accounts only.
• C) an income statement account and a balance sheet account.
• D) either a balance sheet account or an income statement account but not both.

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Definitions:

Percent Of Sales Method

A financial forecasting model that estimates future financial statements based on assumed sales growth and historical financial ratios.

Bad Debts

Unrecoverable amounts owed to a company by debtors that are deemed uncollectable and written off as a loss.

Receivables Methods

Methods used by businesses to manage and account for money owed to them by customers for goods or services delivered on credit.

Due Date

The specified date by which a task, assignment, payment, or project is expected or required to be completed or submitted.