One of the major advantages of making adjustments in order to improve the quality of financial statements is that they:
A)ensure that revenues and expenses are recognized during the period they are earned and incurred.
B)ensure that all estimates of future activities are eliminated from consideration.
C)ensure that revenues and expenses are recognized conservatively during the period they are paid.
D)all of the answers are acceptable.

Question

Quizplus · Accepted Answer

Adjustments made to improve the quality of financial statements ensure that revenues and expenses are recognized during the period they are earned and incurred. This enhances the accuracy and reliability of financial information presented to stakeholders. Choices B and C are incorrect as they do not accurately reflect the purpose of adjustments in financial statements. The answer cannot be D as not all the choices are acceptable.

One of the Major Advantages of Making Adjustments in Order