Account Adjustments: Types, Purpose & Their Link to Financial Statements


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question 1 of 3

Money earned in one accounting period but not received until another is called _____.

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1. Entries made in the general journal at the end of an accounting period to bring account balances up to date are called _____.

2. Money that a business has been paid in advance for a service that will be provided later is called _____.

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About This Quiz & Worksheet

What are account adjustments, what types are made, and why are they used? You may use this quiz and corresponding worksheet to test your knowledge of this accounting procedure.

Quiz and Worksheet Goals

In these assessments, you'll be tested on:

  • The term that refers to money earned but not received in an accounting period
  • The type of entry that updates accounting balances
  • The term that refers to money paid in advance
  • The term for incurred expenses that are paid in another accounting period
  • What necessitates account adjustments

Skills Practiced

This worksheet and quiz will allow you to test the following skills:

  • Reading comprehension- ensure that you draw the most important information from the related lesson about events that lead to account adjustments
  • Defining key concepts - ensure that you can accurately define main phrases, such as accrued revenue and deferred expense
  • Information recall - access the knowledge you've gained regarding the reasons for account adjustments
  • Distinguishing differences - compare and contrast topics from the lesson, such as accrued and deferred expenses and revenues

Additional Learning

To learn more about this accounting step, review the accompanying lesson called Account Adjustments: Types, Purpose & Their Link to Financial Statements. This lesson covers the following objectives:

  • Define account adjustments
  • Discuss events leading to account adjustments
  • Outline types of account adjustments
  • Provide an example of adjusted entries
  • Explain the need to adjust accounts