Adjusting Entries for Accruals Will Never Affect ________

question 120

Multiple Choice

Adjusting entries for accruals will never affect ________.

• A)shareholders' equity
• B)expenses
• C)liabilities
• D)cash

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Definitions:

Current Ratio

The Current Ratio is a liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year, by comparing a company's current assets to its current liabilities.

Inventories

Assets consisting of goods available for sale to customers in the ordinary course of business.

Common Stock

A form of corporate equity ownership, a type of security representing ownership interests in a corporation.

EBITDA Coverage

A ratio that measures a company’s ability to pay off its operational and debt-related expenses with its earnings before interest, taxes, depreciation, and amortization.