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-   -   Explain the affect of missing adjusting entries on net income. (https://www.askmehelpdesk.com/showthread.php?t=405034)

  • Oct 11, 2009, 10:53 PM
    myaline1987
    Explain the affect of missing adjusting entries on net income.
    Need help pleaz with that question! Thanks
  • Oct 13, 2009, 07:31 PM
    ROLCAM

    You need to be more specific about what kind of INCOME you are talking about and also what type of business you are accounting for.

    As a simple example in an INSURANCE
    BUSINESS , the premiums received are NOT fully earned.
    The Income needs adjusting for the UNEXPIRED PARTS OF THE PREMIUMS.

    The affect this will have is obviously REDUCING the Final Net Income.

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