Regarding the Effects of End-Of-Period Adjustments, State Whether Each of the Following

question 62

Essay

Regarding the effects of end-of-period adjustments, state whether each of the following statements is true or false.Recording the usage of supplies involves an increase in liabilities and a decrease in stockholders' equity.The accrual of salaries is considered a claims exchange transaction.Recording services performed on a prepaid contract involves a decrease in liabilities and an increase in assets.End-of-period adjustments often affect cash flows.Failure to record accrued salaries at the end of the year will cause reported net income to be higher than it should have been.

---

Definitions:

Point-Of-Purchase Displays

In-store advertising or marketing materials positioned at retail checkout areas or other point-of-sale locations to encourage impulse purchases or inform customers about products.

End-Aisle Displays

Promotional displays located at the end of store aisles, used to catch shoppers' attention and promote products, often accompanied by special offers.

Extended Service Warranties

Additional coverage that consumers can purchase to extend the warranty period of a product, providing longer protection against defects or failures.

Selective Retention

The psychological process by which individuals remember information that is consistent with their beliefs and forget information that is inconsistent.