Prepaid expenses, depreciation, accrued expenses, unearned revenues, and accrued revenues are all examples of:
A)Classified balance sheet accounts.
B)Income statement accounts.
C)Assets.
D)Items that require adjusting entries.
E)Items that require contra accounts.

Question

Quizplus · Accepted Answer

These are all items that require adjusting entries. Prepaid expenses and unearned revenues are assets that need to be adjusted for the portion used or earned during the period. Depreciation is an expense that needs to be recognized as the asset is used over time. Accrued expenses and revenues are also adjusting entries needed to recognize expenses or revenues that have been incurred or earned but not yet recorded in the accounting records.

Prepaid Expenses, Depreciation, Accrued Expenses, Unearned Revenues, and Accrued Revenues