Which of the following statements regarding adjusting entries is not true?
A)Adjustments are needed to ensure that the accounting system includes all of the revenues and expenses of the period.
B)Adjustments help to ensure the related accounts on the balance sheet and income statement are up to date and complete.
C)Adjusting entries often affect the cash account.
D)Adjusting entries generally include one balance sheet and one income statement account.

Question

Quizplus · Accepted Answer

Adjusting entries do not always affect the cash account. Adjusting entries typically involve updating accounts that reflect accruals, deferrals, and estimates, which may not necessarily affect cash.

Which of the Following Statements Regarding Adjusting Entries Is Not