Adjusting journal entries:

Question

Quizplus · Accepted Answer

Adjusting journal entries are made at the end of an accounting period to ensure that the financial statements reflect accurate and complete information. These entries can affect both income statement and balance sheet accounts, as they are used to record items such as accrued expenses, unearned revenue, depreciation, and inventory adjustments. Adjusting entries do not impact cash flow accounts directly, as they reflect non-cash items, but they can indirectly impact cash flow by affecting income and expenses that impact net income and, therefore, cash flow.

Adjusting Journal Entries