Question

Every adjustment entry affects:

Answer 1

Answer:

one permanent account and one temporary account.

Explanation:

The adjustment is made to a permanent account, using a temporary account

For example:

insurance expense   debit (T)

prepaid insurance credit (P)

to record expired insurance for the period

depreciation expense debit (T)

accumulated depreciation equipment credit (P)

to record depreciation for the period

unearned revenue debit (P)

service fee revenue credot (T)

to record accrued revenue

supplies expense debit (T)

supplies credit (P)

In this example, all have in common a permanent account (Asset, Liability or equity)

and a temporary account (expense or revenue)

The goal of the adjustment entries is to represent the past of time.

We will have accrued expenses or accrued revenues.

Remember that, temporary account are those which  the accoutning closes at the end of the period. (revenue and expenses)

While permanent account stay, assets, liability and equity.