My Learning Cart
?
Categories
Account

What is the effect of recording an adjusting entry for accrued expenses on the t

₹0.0
Login to Download
  • 📥 Instant PDF Download
  • ♾ Lifetime Access
  • 🛡 Secure & Original Content

What’s inside this PDF?

Question: What is the effect of recording an adjusting entry for accrued expenses on the trial balance?

Options:

  1. Increase total debits and total credits
  2. Decrease total debits and total credits
  3. Increase total debits and decrease total credits
  4. Decrease total debits and increase total credits

Correct Answer: Increase total debits and total credits

Solution: 

Recording an adjusting entry for accrued expenses increases total debits (expenses) and total credits (liabilities), keeping the trial balance in balance.

What is the effect of recording an adjusting entry for accrued expenses on the t

Practice Questions

Q1
What is the effect of recording an adjusting entry for accrued expenses on the trial balance?
  1. Increase total debits and total credits
  2. Decrease total debits and total credits
  3. Increase total debits and decrease total credits
  4. Decrease total debits and increase total credits

Questions & Step-by-Step Solutions

What is the effect of recording an adjusting entry for accrued expenses on the trial balance?
  • Step 1: Understand what accrued expenses are. These are expenses that have been incurred but not yet paid.
  • Step 2: Know that when we record an adjusting entry for accrued expenses, we need to increase the expense account.
  • Step 3: Realize that increasing the expense account means we are adding a debit to the trial balance.
  • Step 4: Understand that we also need to increase a liability account (like 'Accrued Expenses Payable') to show that we owe this money.
  • Step 5: Know that increasing the liability account means we are adding a credit to the trial balance.
  • Step 6: Remember that in accounting, total debits must equal total credits for the trial balance to be balanced.
  • Step 7: Conclude that by adding both a debit (for expenses) and a credit (for liabilities), the trial balance remains balanced.
No concepts available.
Soulshift Feedback ×

On a scale of 0–10, how likely are you to recommend The Soulshift Academy?

Not likely Very likely
Home Practice Performance eBooks