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Types of Adjusting Entries for Manufacturing

If you were an accountant in a manufacturing company, explain why adjusting entries are necessary.

- Describe the 4 types of adjusting entries, and provide a manufacturing industry example of each.
- Describe how these entries would be recorded in a computerized accounting system.

No direct quotes please. Be sure to include APA in-text citations and references. Wikipedia is not allowed.

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ADJUSTING ENTRIES

If you were an accountant in a manufacturing company, explain why adjusting entries are necessary.

Within a manufacturing company, adjusting entries are important as they are useful for the purpose of allocating both revenue and expenses into the period or accounts to which they belong to. While normal journal entries are recorded off actual transactions, adjusting entries become crucial to ensure that all transactions are appropriately correlating with the actual dates in which they occurred. This is usually done so as to satisfy the matching principle within accrual accounting (Net MBA, 2010).

Describe the 4 types of adjusting entries, and provide a manufacturing industry example of each.

The 4 types of adjusting entries include converting assets to expenses, converting liabilities to revenue, accruing unpaid expenses and accruing uncollected revenues.

In the conversion of assets to expenses, this involves a transaction where a future expense was paid in advance, therefore making or creating it to be an asset. The ...

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This solution provides a detailed discussion of adjusting entries in accounting.

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