Explain why an adjusting entry is needed and calculate the amount of the adjustmentDescrip...

Explain why an adjusting entry is needed and calculate the amount of the adjustment

Descriptions of transactions and how they were recorded follow for October, 2012 for Ausley Acoustics.

Requirement

1. Indicate if an adjusting entry is needed for each item on October 31 and why the entry is needed (i.e., an asset or liability account is over/understated). Indicate which specific account on the balance sheet is misstated. Finally, indicate the correct balance that should appear in the balance sheet account after the adjustment is made. Use the following table guide. Item a is completed as an example: