At the End of the Fiscal Year,an Adjusting Entry Is

question 33

Multiple Choice

At the end of the fiscal year,an adjusting entry is made that increases both interest expense and interest payable.This entry is an application for which accounting principle?

• A)Full disclosure
• B)Materiality
• C)Matching
• D)Going concern
• E)Realization

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Definitions:

Unsatisfied Judgment

A legal judgment that has not been fully paid or settled by the debtor.

Insolvent

The state of being unable to pay debts when they are due, often leading to bankruptcy proceedings.

Dissolution

The process of legally terminating the existence of a corporation, partnership, or other legal entity.

Creditors

Creditors are individuals or institutions that lend money or extend credit to others, holding the right to receive payment for debts owed to them.