1 / 23

Creating a Worksheet for Financial Summary

Learn how to prepare a worksheet for summarizing financial information, including trial balances, adjustments, and extending account balances for income statements and balance sheets.

irag
Download Presentation

Creating a Worksheet for Financial Summary

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. LESSON 6-1 Creating a Worksheet

  2. 1 Name of Company 2 Name of Report 3 Date of Report PREPARING THE HEADING OF A WORK SHEET page 153 LESSON 6-1

  3. 2 1 4 3 5 6 PREPARING A TRIAL BALANCE ON A WORK SHEET page 154 1. Write the general ledger account titles. 2. Write the general ledger debit account balances. Write the general ledger credit account balances. 3. Rule a single line across the two Trial Balance columns. 4. Add both the Trial Balance Debit and Credit columns. 5. Write each column’s total below the single line. 6. Rule double lines across both Trial Balance columns. LESSON 6-1

  4. TERMS REVIEW page 155 • fiscal period: the length of time for which a business summarizes and reports financial information • work sheet: a columnar accounting form used to summarize the general ledger information needed to prepare financial statement • trial balance: a proof of the equality of debits and credits in a general ledger LESSON 6-1

  5. LESSON 6-2 Planning Adjusting Entries on a Work Sheet

  6. 3 SUPPLIES ADJUSTMENT ON A WORK SHEET page 158 2 1 1. Write the debit amount. 2. Write the credit amount. 3. Label the two parts of this adjustment. LESSON 6-2

  7. 3 PREPAID INSURANCE ADJUSTMENT ON A WORK SHEET page 159 2 1 1. Write the debit amount. 2. Write the credit amount. 3. Label the two parts of this adjustment. LESSON 6-2

  8. 1 2 3 PROVING THE ADJUSTMENTS COLUMNS OF A WORK SHEET page 160 1. Rule a single line. 2. Add both the Adjustments Debit and Credit columns. Write each column’s total. 3. Rule double lines. LESSON 6-2

  9. PREPARING A WORK SHEET page 160 C 1. Write the heading. 2. Record the trial balance. 3. Record the supplies adjustment. 4. Record the prepaid insurance adjustment. 5. Prove the Adjustments columns. 6. Extend all balance sheet account balances. 7. Extend all income statement account balances. 8. Calculate and record the net income (or net loss). 9. Total and rule the Income Statement and Balance Sheet columns. LESSON 6-2

  10. LESSON 6-2

  11. 1 LESSON 6-2

  12. 496400 10000 15000 496400 10000 15000 6 10000 102500 120000 10000 31000 110000 (a) 71500 (b) 10000 20000 5000 500000 20000 5000 500000 3 62500 4 62500 356500 356500 21300 21300 (b) 10000 10000 2800 30000 7 2800 30000 (a) 71500 5 71500 11000 11000 8 9 1 2 881500 881500 81500 81500 146600 356500 734900 525000 Net Income 209900 209900 356500 356500 734900 734900 LESSON 6-2

  13. TERM REVIEW page 161 • Adjustments: changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period. LESSON 6-2

  14. LESSON 6-3 Extending Financial Statement Information on a Work Sheet

  15. 2 1 3 EXTENDING BALANCE SHEET ACCOUNT BALANCES ON A WORK SHEET page 162 1. Debit balances without adjustments 2. Debit balances with adjustments 3. Credit balances without adjustments LESSON 6-3

  16. 1 2 3 EXTENDING INCOME STATEMENT ACCOUNT BALANCES ON A WORK SHEET page 163 1. Sales balance 2. Expense balances without adjustments 3. Expense balances with adjustments LESSON 6-3

  17. 4 2 1 5 3 6 7 RECORDING NET INCOME, AND TOTALING AND RULING A WORK SHEET page 164 1. Single rule 2. Totals 4. Extend net income 6. Totals 3. Net income 5. Single rule 7. Double rule LESSON 6-3

  18. 1 3 4 2 CALCULATING AND RECORDING A NET LOSS ON A WORK SHEET page 165 1. Single rule 2. Totals 3. Net loss 4. Extend net loss LESSON 6-3

  19. TERMS REVIEW page 166 • balance sheet: a financial statement that reports assets, liabilities, and owner’s equity on a specific date. • income statement: a financial statement showing the revenue and expenses for a fiscal period • net income: the difference between total revenue and total expenses when the total revenue is greater • net loss: the difference between total revenue and total expenses when total expenses are greater LESSON 6-3

  20. LESSON 6-4 Finding and Correcting Errors on the Work Sheet

  21. 2 Correct entry 1 Incorrect entry CORRECTING AN ERROR IN POSTING TO THE WRONG ACCOUNT page 168 1. Draw a line through the entire incorrect entry. Recalculate the account balance and correct the work sheet. 2. Record the posting in the correct account. Recalculate the account balance, and correct the work sheet. LESSON 6-4

  22. CORRECTING AN INCORRECT AMOUNT page 169 2 1 3 1. Draw a line through the incorrect amount. 2. Write the correct amount just above the correction in the same space. 3. Recalculate the account balance, and correct the account balance on the work sheet. LESSON 6-4

  23. CORRECTING AN AMOUNT POSTED TO THE WRONG COLUMN page 169 2 1 3 5 4 6 4. Draw a line through the incorrect item in the account. 5. Record the posting in the correct amount column. 6. Recalculate the account balance, and correct the work sheet. LESSON 6-4

More Related