Adjusting Entry

A journal entry at the end of an accounting period to bring an asset or liability account balance to its proper amount while also updating the related expense or revenue account.

• Some assets are used up during their lifetime and become expense.
• The cost is allocated to expense over the span of several accounting periods with adjusting entries.
• Adjusting entries are made at the end of the accounting periods to make the financial statements accurate.
• One of the most common adjusting entries is Depreciation expense.

>> More Accounting Terms & Glossary?