Adjusting Entry


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Adjusting Entry

1. An adjustment made to a company's financial records at the end of an accounting period to assign revenues and expenses to the days on which the events justifying them occurred or on which the revenue was received, depending on the situation. For example, if a company is paid in advance for the purchase of some good, an adjusting entry may recognize that revenue on the day the good was delivered. Likewise, if the company was paid after delivery, it may recognize the revenue on the day it was paid. See also: Accrued Expenses, Accrued Revenue, Prepaid Expenses, Unearned Revenue.

2. Any correction to a previous entry in a company's financial records.
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References in periodicals archive ?
Since S has only cash that is valued correctly, there is no adjusting entry needed for P's investment in S's account.
An adjusting entry at December 31, 1999 is needed to adjust the swap to its fair value of $45,000.
An adjusting entry is made at year end for 1998 to adjust the futures contracts to fair value based on the closing price for that date.
For this reason, when using an allowance account, assume that the other side of the adjusting entry will be entirely to COGS (rather than to a loss account or to some combination of the two accounts).
31 Adjusting entry for market value of hay on hand (33) 2,300 2,300 Dec.
31 Adjusting entry to record change in accounts receivable (42) 3,500 3,500 1212 Feeder Livestock Inventory Purchased for Resale Date Description JE# Debits Credits Balance Beginning Balance 0 Dec.
SEC's contemplated adjustment Year 5 adjusting entry Payable $100 Expense $100
This suggests that an adjusting entry could be used to recast the 2000 financial statements.
Misstatements" in this context refers to those that would normally be corrected by a journal or adjusting entry.