Which of the Following Does Not Require an Adjusting Entry

question 236

Multiple Choice

Which of the following does not require an adjusting entry at year-end?

• A) Cash invested by owner.
• B) Expired portion of prepaid insurance.
• C) Accrued interest on notes payable.
• D) Accrued wages.
• E) Supplies used during the period.

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Definitions:

Credit Terms

Credit terms are the conditions under which a seller will extend credit to a buyer, including the repayment period, discount for early payment, and the late fee.

Payments

Transactions involving the transfer of money or equivalent to another party in exchange for goods, services, or to fulfill a legal obligation.

Merchandise Inventory

Goods that a retailer or wholesaler purchases for resale to customers.

Ending Merchandise Inventory

The final stock value of goods being sold by a retail or wholesale company at the close of an accounting period.