When you are balancing your books, it’s important to know the difference between adjusting entries and closing entries. Adjusting entries are often necessary because collecting the adjustment data requires time. The adjusting entries are made after income is recognized for a financial period, but before you close that financial period.

For example, you might make an adjusting entry to increase a receivable account for the amount of interest earned on that receivable. When you are balancing your books, it’s important to know the difference between adjusting entries and closing entries. Adjusting entries are often necessary because collecting the adjustment data requires time. The adjusting entries are made after income is recognized for a financial period, but before you close that financial period. For example, you might make an adjusting entry to increase a receivables account for the amount of interest earned on that receivable. — – When you’re balancing your books (or “accounting”) __it’s important to know all the details about how transactions happened during each accounting period; through

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