Prior to recording adjusting entries at the end of an accounting period, some accounts may not show correct balances even though all business transactions were properly recorded.

Question

Quizplus · Accepted Answer

Adjusting entries are necessary to update certain accounts that may not show correct balances due to the timing of the transactions or unrecorded transactions. Without adjusting entries, financial statements may not accurately represent the true financial position of the business.

Prior to Recording Adjusting Entries at the End of an Accounting