Concept explainers
Adjusting entries are made at the end of the year to adjust the financial position of the enterprise according to accrual basis of accounting.
Accounting rules regarding
► Balance increase when: Assets, losses and expenses get debited and liabilities, gains, and revenue get credited.
► Balance decrease when: Assets, losses and expenses get credited and liabilities, gains, and revenue get debited.
Income Statement:
It is a financial statement which show the
Statement of
It is a financial statement which shows the amount of profit retained by the company for their future unforeseen events.
Balance sheet:
It reports the position of the company in financial terms. It consists of asset and liabilities.
To prepare: Adjusting entry, financial statement and explain impact of adjusting entry on net income
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Connect 2 Semester Access Card for Financial and Managerial Accounting
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