Is the Cash ledger account used in adjusting entries?

In the context of adjusting entries, the Cash ledger account is typically not used directly. Adjusting entries are made to update accounts at the end of an accounting period to ensure that the financial statements reflect the correct amounts of revenue and expense, aligning with the accrual basis of accounting.

Common adjusting entries often involve accounts such as accounts receivable, accounts payable, accrued expenses, prepaid expenses, and unearned revenues, rather than directly impacting cash. For example, if an adjustment needs to be made for accrued salaries, the salaries expense and accrued liabilities accounts would be adjusted, but cash would not be directly impacted in that entry.

While cash can be involved in some adjustments indirectly, it is not customary to use the Cash ledger account for adjusting entries specifically. Adjusting entries focus on recognizing revenues and expenses that have occurred but haven't yet been recorded in the cash accounts. Therefore, the correct interpretation is that the Cash ledger account is not used in adjusting entries.