Which of the following transactions is most likely not to result in an adjusting entry at the end of the period?
A)Performance of a service for which payment was not received in advance.
B)Purchase of inventory for sale in the subsequent period.
C)Purchase of office equipment.
D)Purchase of a two-year insurance policy.

Question

Quizplus · Accepted Answer

The purchase of inventory for sale in the subsequent period does not require an adjusting entry at the end of the current period. Adjusting entries are required for transactions that have an impact on the current period's financial statements but are not yet recorded in the accounts. Purchases of inventory are recorded at cost and expensed in the subsequent period when they are sold. Therefore, no adjusting entry is needed at the end of the period for this transaction.

Which of the Following Transactions Is Most Likely Not to Result