Which of the Following Is NOT a Correct Statement About

question 74

Multiple Choice

Which of the following is NOT a correct statement about adjusting entries?

• A)Every adjusting entry affects cash.
• B)Every adjusting entry affects the balance sheet.
• C)Every adjusting entry affects net income.
• D)Adjusting entries are posted before the adjusted trial balance is prepared.

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Definitions:

Owner's Equity

The residual interest in the assets of a business after all liabilities are subtracted, representing ownership's claim on assets.

Expenses

Expenses are the outflows or the utilization of assets or incurring of liabilities during a period in the course of generating revenue.

Cash

A liquid asset representing currency or its equivalents that can be used immediately in transactions without any conversion or delay.

Services Rendered

The provision of work performed by one party for another in exchange for compensation.