Subsequent events that provide additional evidence as to conditions that existed at the balance sheet date may result in adjusting journal entries.

Question

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Adjusting journal entries are made to reflect any changes to the financial position of a company that occurred after the balance sheet date but before the financial statements were issued. Subsequent events that provide additional evidence as to conditions that existed at the balance sheet date are one type of event that could result in an adjusting entry.

Subsequent Events That Provide Additional Evidence as to Conditions That