Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 4 - No. 28)
Which adjustments should be made to the income statement to arrive at adjusted net profit?
Increase bank interest receivable.
Decrease the closing inventory by $25,000.
Increase telephone and communications to $5,000.
Decrease purchases by $21,700.
Explanation
Adjustments that affect expenses and revenues are reflected in the income statement to calculate the adjusted net profit.
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