If the Debit Portion of an Adjusting Entry Is to an Asset

question 47

True/False

If the debit portion of an adjusting entry is to an asset account, then the credit portion must be to a liability account.

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Definitions:

Finished Goods

Products that have completed the manufacturing process but have not yet been sold or distributed to the end customer.

FIFO

"First-In, First-Out," an inventory valuation method where goods first purchased or produced are the first to be sold, affecting the cost of goods sold and ending inventory.

LIFO

An inventory valuation method called "Last In, First Out" where the most recently produced or purchased items are the first to be expensed as cost of goods sold.

Cordless Screwdrivers

Electric screwdrivers that operate without a direct power supply connection, using rechargeable batteries instead.