What Is FALSE Regarding Adjusting Entries and QBO

question 5

Multiple Choice

What is FALSE regarding adjusting entries and QBO?

• A)Adjusting entries are dated the last day of the accounting period which can be one month,one quarter or one year.
• B)Adjustments are made through the Chart of Accounts during the year and then using the Onscreen Journal at the end of the year.
• C)Adjusting Entries are entered in the Onscreen QBO Journal using debits and credits.
• D)Some companies use QBO to maintain its accounting system throughout the year and use an accountant to prepare and enter adjusting entries at year end.

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Definitions:

Merchandise

Goods that are purchased for the purpose of being sold to customers in the retail environment.

Warranty Expense

A cost incurred by a company to repair or replace products during a specified period under warranty coverage.

Warranty Service

A promise from the seller or manufacturer to repair or replace defective products within a specified time period at no additional cost to the buyer.

Estimated Warranty Expense

An accounting provision representing the anticipated cost of honoring product warranties, calculated based on historical warranty data and sales forecasts.