Trial Balance/ Vocabulary
What will the date for adjusting entries be?
The last day of the month
What should be written above the journal entries when you make adjustments at the end of the month?
"Adjusting Entries"
What is the source document for adjusting entries?
There is no source document
What should the post reference in the general ledger say?
G1 or whatever page number of the general journal the transaction refers to
It should say the account number from the ledger once you post the transaction to the ledger
A columnar accounting form used to summarize the general ledger information needed to prepare financial statements is called a
Worksheet
The series of accounting activities included in
recording financial information for a fiscal period
is called an
Accounting Cycle
Changes recorded on a worksheet to update general ledger accounts at the end of a fiscal period are called
Adjustments
What is the entry when we buy supplies? What is the adjusting entry for supplies?
Supplies, Cash
Supplies Expense, Supplies
What does it mean if the credits on the income statement are greater than the debits?
The company had a net income
What is the order of the title for the work sheet?
Company Name, Worksheet, For month (quarter) ended month, year
The length of time for which a business summarizes its financial information and reports its financial performance is called
Fiscal Period
Reporting income when the cash is received and expenses when the cash is paid is called the
Cash Basis of Accounting
What is the entry when we buy prepaid insurance? What is the adjusting entry for prepaid insurance?
Debit Prepaid Insurance, Credit Cash
Debit Insurance Expense, Credit Prepaid Insurance
What type of accounts go on the balance sheet?
Assets, Liabilities and Equity
Drawings, Expenses, Assets- Debits
Liabilities, Equity, Revenue- Credit
What is the equation for net income?
Revenue- Expenses
Reporting income when it is earned and expenses when they are incurred is called the
Accrual Basis of Accounting
Why do we make adjustments?
Because supplies/ prepaid insurance are used?
What type of accounts go on the income statement?
Revenue and Expenses