American Business   29-05-2012, 12:12  Adjusting entry, trial
balance, adjusted trial balance  An adjusting entry is a journal
entry made at the end of an accounting period to record accruals
that have occurred during that time period. Adjusting entries
are common to ACCRUAL BASIS accounting, but they are not found
in cash basis accounting. An accrual is an ASSET (other than
cash), LIABILITY, equity account, revenue or expense that has
accrued within a particular accounting period. In the case of a
long-term note receivable, interest income will be earned each
accounting period, although the interest income may not be
received until the maturation of the note. Interest income will
accrue over the life of the note, and it must be recorded as it
is earned, not when it is received. In the case of a note
payable, interest expense will accrue over time. As interest
expense accrues, it must be recorded. The recognition and
recording of such accruals is normally done at the end of the
accounting period with adjustin