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Adjusting journal entries A need not be journalized since they appear in the worksheet B need...

Adjusting journal entries
A need not be journalized since they appear in the worksheet
B need not be posted if the financial statement are prepared from the worksheet
C are not needed if closing entries are prepared
D just be journalized and posted
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Answer #1

Answer : D. just be journalized and posted

Explantion : let's assume that a company borrowed money from its bank on December 1, 2017 and that the company's accounting period ends on December 31. The bank loan specifies that the first interest payment on the loan will be due on March 1, 2018. This means that the company's accounting records as of December 31 do not contain any payment to the bank for the interest the companyincurred from December 1 through December 31. An adjusting entry is needed so that December's interest expense is included on December's income statement and the interest due as of December 31 is included on the December 31 balance sheet. The adjusting entry will debit Interest Expense and credit Interest Payable for the amount of interest from December 1 to December 31.

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