Reversing entries occur at the beginning of the accounting period and:
A) help to reduce potential errors.
B) simplify the bookkeeping associated with accruals from the prior period.
C) reverse the adjusting entries.
D) All of the above are correct.

Question

Quizplus · Accepted Answer

Reversing entries are made at the beginning of a new accounting period to simplify the accounting process. They help reduce potential errors by clearing the balances of temporary accounts that were adjusted at the end of the previous period, thus simplifying the bookkeeping related to prior period accruals and effectively reversing the adjusting entries made.

Reversing Entries Occur at the Beginning of the Accounting Period