Errors are corrected by adjusting the beginning balance in the Retained Earnings account in the period the error is discovered.

Question

Quizplus · Accepted Answer

When an error is discovered in the Retained Earnings account, the beginning balance of the current period must be corrected to reflect the proper amount. This adjustment will ensure that the account's ending balance is accurate and that any subsequent transactions are recorded correctly. Thus, the statement is true.

Errors Are Corrected by Adjusting the Beginning Balance in the Retained