Final answer:
The purpose of adjusting entries is to ensure that all expenses and revenues are accounted for in the period they are incurred or earned and that balances on the balance sheet and income statement are correct at the end of the accounting period. Hence, all the answer choices provided are together correct.
Step-by-step explanation:
Adjusting entries are made to ensure that: A) expenses are recognized in the period in which they are incurred, B) revenues are recorded in the period in which the performance obligation is satisfied, and C) balance sheet and income statement accounts have correct balances at the end of an accounting period. Therefore, the correct answer to this question is D) all of these answer choices are correct.
Adjusting entries are a crucial part of the accounting cycle, and they ensure that financial statements reflect the true financial position and performance of a company for any given period. They help in maintaining the integrity of the financial statements by adhering to the accrual basis of accounting, where revenues and expenses are recognized in the period they occur, rather than when cash is received or paid.