Adjustments are recorded at the end of each accounting period so that net income is accurately reflected in the financial statements for the period.

Question

Quizplus · Accepted Answer

Adjustments are necessary to ensure that all revenues and expenses are recognized in the appropriate accounting period and that the financial statements are accurate and complete. Without adjustments, the net income may be overstated or understated, and investors and other stakeholders may be misled about the company's financial performance. Therefore, adjustments are typically made at the end of each accounting period to correct any discrepancies and to reflect the true financial position of the company.

Adjustments Are Recorded at the End of Each Accounting Period