slide1
Download
Skip this Video
Download Presentation
The heading should identify the entity, the document and the time period.

Loading in 2 Seconds...

play fullscreen
1 / 27

The heading should identify the entity, the document and the time period. - PowerPoint PPT Presentation


  • 280 Views
  • Uploaded on

The heading should identify the entity, the document and the time period. The worksheet collects and summarizes the information used to prepare financial statements, adjusting entries and closing entries. Step 1 Enter the unadjusted trial balance on the worksheet.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'The heading should identify the entity, the document and the time period.' - salena


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.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
slide2
The worksheet collects and summarizes the information used to prepare financial statements, adjusting entries and closing entries.
slide3
Step 1

Enter the unadjusted trial balance on the worksheet

slide5
Step 2

Enter the adjustments directly onto the worksheet

slide6
Step 2

Enter the adjustments directly onto the worksheet

You may need to add additional accounts

slide7
Step 2

Enter the adjustments directly onto the worksheet

slide9
Step 3

Sum the unadjusted trial balance with the adjustments and enter the total in the adjusted trial balance column.

slide10
Helpful Hint #1

Remember that if an account has a debit balance on the unadjusted trial balance, it will have a debit balance on the adjusted trial balance as well.

slide11
Helpful Hint #2

A debit balance is increased by a debit adjustment but would be decreased by a credit adjustment. Therefore, for supplies, $3,600 – 1,050 = 2,550

slide12
Helpful Hint #3

Similarly, if an account has a credit balance on the unadjusted trial balance, it will have a credit balance on the adjusted trial balance as well.

slide13
Helpful Hint #4

When an account has a credit balance on the unadjusted trial balance, it will be decreased by a debit adjustment and increased by a credit adjustment. For unearned consulting revenue, $3,000 - 250 = $2,750

slide14
Helpful Hint #5

If a new account was added because of adjusting entries, then the adjusted trial balance will equal the amount of the debit or credit entered in the adjustments column.

slide15
Helpful Hint #6

Don’t forget to add all the debits in the debit column of the adjusted trial balance and make sure they are equal to all of the credits in the credit column. As always,Dr = Cr

slide16
Step 4

Complete the worksheet.

slide17
Helpful Hint #7

Once the adjusted trial balance columns are in balance, you can ignore the previous four columns. Only the balance from the adjusted trial balance column will be entered in ONE of the last four columns.

slide18
Helpful Hint #8

The income statement columns will only have income statement accounts in them (i.e. revenues and expenses). Revenues have credit balances and will therefore be entered in the credit columns.

slide19
Helpful Hint #9

Expenses have debit balances and will therefore be entered in the debit columns.

slide20
Helpful Hint #10

The balance sheet columns contain assets, liabilities, capital and withdrawals. A debit from the adjusted trial balance is recorded in the debit column of the balance sheet.

slide21
Helpful Hint #11

A credit from the adjusted trial balance is recorded in the credit column of the balance sheet.

slide23
Step 5

Calculate net income (loss) by subtracting the debits (expenses) from the revenues (credits). This amount should be entered under the smaller of the two totals. In this case,$6,150 – 4,085 = 2,065. This number will be put in the debit column.

slide24
Helpful Hint #12

Since net income was entered in the debit column of the income statements, it will also be entered in the balance sheet. This time, as a credit, since Dr = Cr

slide25
Helpful Hint #13

Now, the last check of the worksheet is to total the income statement and balance sheet columns again. If you have completed the worksheet correctly: Dr = Cr

slide26
Helpful Hint #14

Now, how do we complete this section of the work sheet in the case of a net loss? To demonstrate, assume instead that total expenses were 4,085 and revenues were 2,500.

slide27
Helpful Hint #15

Under this assumption, the difference between revenues and expenses equals a net loss of 1,585. This amount should be entered under the smaller of the two totals. Enter 1,585 in the credit column of the income statement and the debit column of the balance sheet.

ad