Every adjusting entry involves the recognition of either revenue or owner's equity.

Question

Quizplus · Accepted Answer

Not every adjusting entry involves the recognition of either revenue or owner's equity. Adjusting entries are made at the end of an accounting period to ensure that the financial statements accurately reflect the business's financial performance and position. These entries can also include the recognition of expenses, liabilities, and other items that affect the financial statements.

Every Adjusting Entry Involves the Recognition of Either Revenue or Owner's