Which of the following pairs of accounts could not appear in the same adjusting entry?
A) Fees Earned and Unearned Fees
B) Interest Income and Interest Expense
C) Rent Expense and Prepaid Rent
D) Salaries Payable and Salaries Expense

Question

Quizplus · Accepted Answer

Adjusting entries are made to record internal transactions that are not initiated by an external transaction. They typically involve one income statement account (revenue or expense) and one balance sheet account (asset or liability). Interest Income and Interest Expense represent two different types of transactions: one is revenue earned from investments or lending, and the other is the cost incurred from borrowing. They would not be adjusted against each other in the same entry as they relate to different transactions and would not directly affect each other's balances.

Which of the Following Pairs of Accounts Could Not Appear