Some adjusting entries involve estimated amounts because they are based on expected future events.

Name: Some adjusting entries involve estimated amounts because they are based on expected future events.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Adjusting entries often include estimates for expenses or revenues that have been incurred but not yet realized, such as depreciation, allowance for doubtful accounts, and accrued expenses, because they are based on expected future events or outcomes.

Some Adjusting Entries Involve Estimated Amounts Because They Are Based