FINAL ACCOUNT - Adjustment Entry 1

Sl.No.	Type of Adjustment	Adjustment Entry	How dealt with in
			Trading or Profit and Loss A/c	Balance Sheet
1	Closing stock	Closing Stock A/c                    Dr	Credit side of the Trading A/c	Assets side.
		To Trading A/c
2	Outstanding  Expenses: (Wages, Rent, Salaries etc.)	Respective Expenses A/c         Dr	i. If the outstanding is an item chargeable to Trading A/c, add the outstanding expenses with relevant expenses in the debit side of the Trading A/c.	Liabilities side.
		To Respective outstanding expenses A/c
		Example:	ii. If it is an item chargeable to Profit and Loss A/c, add the outstanding expenses to the relevant expenses in the debit side of the Profit and Loss A/c.
		Wages A/c                               Dr.
		To Wages outstanding A/c
		Salaries A/c                            Dr
		To Salaries outstanding A/c
3	Prepaid Expenses: (Insurance Premium)	Respective prepaid Expenses A/c  Dr	Debit side of Trading & Profit and	Assets side.
		To Respective Expenses A/c	Loss A/c by way of deduction from
			respective expenses A/c.
		Example:
		Prepaid Insurance Premium A/c Dr
		To Insurance Premium A/c
4	Accrued Income (Commission)	Accrued Income A/c                  Dr	Credit side of Profit and Loss A/c by	Assets side
		To Respective Income A/c	way of addition to respective Income
		Example:	A/c.
		Accrued Commission A/c
		To Commission A/c
5	Income received in advance (Rent)	Respective Income A/c             Dr	Credit side of Profit and Loss A/c by way of deduction from the respective income A/c.	Liabilities side
		To Respective Income received in advance A/c
		Example:
		Rent received A/c                   Dr
		To Rent received in advance A/c