Which statement regarding adjusting entries is not true? A)Adjusting entries are made at the end of the accounting period. B)Adjusting entries can include cash transactions. C)Adjusting entries are required for accrual accounting. D)The recognition of depreciation expense is a deferral.

Question

Quizplus · Accepted Answer

Adjusting entries are made to ensure that the accounts reflect the correct financial position and results of operations at the end of the accounting period. They are necessary for accrual accounting, where revenues and expenses are recognized when earned or incurred, rather than when cash is received or paid. Adjusting entries can include the recognition of depreciation expense, which is a type of deferral. However, adjusting entries do not typically involve cash transactions, as those are recorded in the cash receipts and disbursements journal or the general journal throughout the period.

Which Statement Regarding Adjusting Entries Is not True