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 at year end
B)Recording amortization on office equipment purchased during the year
C)Recording the gain on the sale of equipment made during the year.
D)Reducing the prepaid rent account for the portion of rent actually used.

Question

Quizplus · Accepted Answer

Adjusting entries are made to ensure that financial statements reflect accurate and complete information, such as recording accrued expenses and revenue or adjusting depreciation and prepaid expenses. Recording the gain on the sale of equipment is not an adjusting entry as it is a result of a transaction and should be recorded when it happened, not at the end of the period.

Which of the Following Is Not an Example of an Adjusting