Because Profit, or the "Bottom Line," Is Not the Measure

question 70

True/False

Because profit, or the "bottom line," is not the measure of success for not-for-profit organizations, managers of charitable organizations do not have to concern themselves with the financial aspects of their organizations.

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Definitions:

Adjusting Entries

Adjusting entries are journal entries made at the end of an accounting period to update the accounts and ensure that the financial statements reflect accurate and fair amounts.

Temporary Accounts

Accounts that are closed to the owner's equity account at the end of the accounting period.

Closing

The process of finalizing accounts at the end of an accounting period, leading to the preparation of financial statements.

Real Accounts

Accounts that represent assets, liabilities, and equity of a business and carry their balances permanently across accounting periods.