Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 24 - No. 47)
What is the purpose of 'end-of-year adjustments'?
To prevent miscalculation of the accounts.
To prepare revenue and expense items for the accounting year.
To ensure revenues and expenses are recognized in the correct accounting periods.
To determine all cash inflows and outflows.
Explanation
End-of-year adjustments help ensure that the revenue and expenses are recognized in the proper accounting period.
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