The updating of accrual accounting records before preparing financial statements is referred to as the:
A) consolidation process.
B) full disclosure process.
C) adjustment process.
D) money measurement process.

Question

Quizplus · Accepted Answer

The updating of accrual accounting records before preparing financial statements is referred to as the adjustment process. This involves making adjustments for items such as accrued expenses, prepaid expenses, and depreciation, in order to ensure that the financial statements reflect the true financial position of the business. The consolidation process refers to the combination of financial statements of multiple entities, while the full disclosure process involves providing all relevant information in the financial statements. The money measurement process refers to the fact that only transactions that can be measured in monetary terms are recorded in the accounting system.

The Updating of Accrual Accounting Records Before Preparing Financial Statements