Reversing entries should not be made for which of the following?
A) Adjusting entries that defer costs by recording them as prepaid expenses.
B) Adjusting entries to expenses that are to be paid in the next period.
C) Adjusting entries to accrue revenue to be collected in the next period.
D) Adjusting entries related to estimates.

Question

Quizplus · Accepted Answer

Reversing entries are typically not made for adjusting entries related to estimates because these adjustments do not involve actual transactions that need to be reversed in the next period. They are adjustments based on changes in estimates, such as depreciation or bad debt expense, which do not have a direct counterpart transaction in the next period to offset.

Reversing Entries Should Not Be Made for Which of the Following