Prepare Adjusting Entries For Deferrals Cases

Abstract

When a company prepares financial statements, there are usually several account balances that do not show the actual conditions in each financial statement. Therefore, the balance on the report must be adjusted first so that it can show the true value by making an adjusting entry. Adjusting entries are made to adjust estimates that do not reflect the actual situation. Adjusting entries are made at the end of the accounting period before preparing fair, accurate and valid financial statements. The purpose of this study was to determine the importance of adjusting journal entries in preparing financial statements so that at the end of the financial period you will get a real account, namely assets, liabilities and capital that shows the actual situation. In addition, to get an account of income and expenses that are recognized in a period that shows the actual situation. The method used is the recording of adjusting journals in the general journal. Next, the results of recording adjusting journals are written in the Adjusting Journal column available in the work sheet. The results of this study indicate that, to be able to show fair, accurate and valid financial statements, you must make adjusting entries to certain estimates whose balances do not show actual results.