Regarding the Effects of End-Of-Period Adjustments, State Whether Each of the Following

question 133

Short Answer

Regarding the effects of end-of-period adjustments, state whether each of the following statements is true or false.
_____ a) Recording the usage of supplies involves a decrease in assets and a decrease in equity.
_____ b) The accrual of salaries is considered a claims exchange transaction.
_____ c) Recording services performed on a prepaid contract involves a decrease in liabilities and an increase in assets.
_____ d) End of period adjustments never affect cash flows.
_____ e) Failure to record accrued salaries at the end of the year will cause reported income to be higher than it should have been.

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Definitions:

Vision/Support

The guidance or backing provided by leaders or stakeholders to achieve a shared long-term goal or ideal future state of an organization.

Learning Organizations

Organizations that actively embrace the pursuit of knowledge and continuous improvement, encouraging creativity and innovation.

Retain Employees

The strategies and practices employers use to prevent turnover and keep employees engaged and committed to the organization.

Knowledge Acquisition

The process through which individuals or systems gather, interpret, and internalize information, transforming it into knowledge.