A reversing entry recorded on the first day of the current accounting period is exactly the same as the related adjusting entry from the last day of the prior accounting period.

Question

Quizplus · Accepted Answer

A reversing entry is not exactly the same as the related adjusting entry; it is made to reverse the effects of certain adjusting entries made at the end of the previous accounting period, typically involving accrued revenues or expenses, to simplify the recording of future transactions.

A Reversing Entry Recorded on the First Day of the Current