Question

Adjusting entries are made to ensure that?-expenses are recognized in the period in which they are incurred.-revenues are recorded in the period in which the performance obligation is satisfied.-All of these choices are correct.-None of the choices are correct.-balance sheet and income statement accounts have correct balances at the end of anaccounting period.e

Answer 1

Answer:

The correct option is all of these choices are correct.

Explanation:

Adjusting Entries: The adjusting entries are those entries which are adjusted at the end of the year.

According to the statements given in the question:

1. Whenever expenses are incurred, it is recognized in the financial statements on that year itself. Moreover, the adjustment entries is also made.

Thus, the given statement is true

2. Under revenue recognition principle, the revenue is recorded when products are supplied and services are rendered to the customers or the performance obligation is completed. Rather than payment is received or not.

Thus, it is a part of adjustment entries

3. If all the correct entries are passed and the income statement and the balance sheet are matched. Or we can say

Assets = Owner's Equity + Liabilities

So, it would be a part of adjusting entries.

When all choices are correct. So, none of the choices are correct option is invalid.

Hence, The correct option is all of these choices are correct.