What are the adjusting entries?

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Adjusting entries are accounting entries made at the end of an accounting period to update accounts and ensure accuracy of financial statements.

Adjusting entries are made to ensure that the financial statements accurately reflect the company's financial position.
They are made at the end of an accounting period and are used to update accounts that have not been recorded yet.
Examples of adjusting entries include accruals, deferrals, and estimates.
Accruals are used to record revenue or expenses that have been earned or incurred but not yet recorded.
Deferrals are used to record revenue or expenses that have been recorded but not yet earned or incurred.
Estimates are used to record expenses that cannot be precisely determined, such as bad debt expense.
Adjusting entries are necessary to ensure that the financial statements are accurate and comply with accounting standards.

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