Basic Point Of Accounting [ Part 2 ]

Basic Point Of Accounting [ Part 2 ]

Written By : Sakin17

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1. 4. Financial Statement

• Income statement

The resume of entity's incomes and expenses at the certain period , e.g. monthly or yearly 

• Statement of the owner's equity 

The resume of  owner's equity change an entity during certain period, e.g. monthly or yearly

• Balance

The list that consists  of entity's assets, liabilities, and owner's equity at the certain date, usually at the last day closing in the a month or a year

• Cash Flow statement

The resume of cash receipts and cash payments of an entity during a certain period, e.g. monthly or yearly.

1. 5. Accounting cycle

• Continued in the next edition (@_^)

OK Let's continue tell you about Basic points of Accounting 

1.5 Accounting Cycle

1. Analyze and record the transactions to the journal
2. Move the transactions to the ledger (doing posting )
3. Prepare the list of balances that unadjusted
4. Prepare and analyze data to make an adjusting 
5. Prepare the worksheet in the ending of period (it is optional) 
6. Make an Adjusting Journal Entry and then move it to the ledger 
7. Prepare the list of balance that have been adjusted 
8. Prepare the income statements 
9. Make a closing journal and move it to the ledger 
10. Prepare the list of balance after closing 

1. 6 The Kinds of Adjusting Journal Entry 

1. Prepaid expenses ( expenses are deferred )
2. Prepaid Income ( Incomes are deferred )
3. Accrual Income 
4. Expenses liabilities 
5. Depreciation expenses
6. And so on

Every entries will always affect balance accounts and nominal accounts at once.

1.7 Closing Entries 

..............*To Be Continued [ next edition ] ^_^