Which of the following is not an example of an adjusting entry?
A) Recording unpaid interest at year end relating to an outstanding loan balance.
B) Recording amortization on oﬃce computers purchased during the year.
C) Recording the loss on the sale of equipment made during the year.
D) Reducing the prepaid rent account for the portion of rent consumed.

Question

Quizplus · Accepted Answer

Adjusting entries are made in the accounting records at the end of an accounting period to allocate income and expenditures to the period in which they actually occurred. The entry for recording the loss on the sale of equipment (C) is not an adjusting entry but rather a transaction entry that reflects a specific event (the sale of equipment) occurring during the year. Adjusting entries typically involve accruals (A), deferrals (D), and depreciation or amortization (B), but not the recording of specific transaction events like sales of assets.

Which of the Following Is Not an Example of an Adjusting