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Accounting Equation & Excel - Adjusting & Reversing Entries
Rating: 5.0 out of 5(1 rating)
41 students

Accounting Equation & Excel - Adjusting & Reversing Entries

Mastering Adjusting Entries and Financial Statements with Excel
Created byRobert (Bob) Steele
Last updated 1/2025
English
English [Auto],

What you'll learn

  • Identify key components of the accounting equation and their role in organizing financial data.
  • Input financial transactions accurately into Excel using an accounting equation format.
  • Analyze financial data to determine necessary adjusting entries for various scenarios.
  • Apply adjusting entries to an Excel worksheet, addressing both textbook examples and real-world complexities.
  • Create professional financial statements, including Balance Sheets and Income Statements, using adjusted Excel data.
  • Evaluate the impact of adjusting entries on financial statements and organizational performance.
  • Differentiate between the bookkeeping process and the adjustment process in accounting.
  • Implement reversing entries to streamline the accounting cycle for subsequent periods.
  • Synthesize the full accounting cycle by integrating data entry, adjustments, financial reporting, and reversing entries.
  • Reflect on the practical applications of accounting principles in Excel for improving accuracy and efficiency in financial management.

Course content

2 sections • 13 lectures • 5h 38m total length

  • 10175 Adjust Worksheet for Adjusting Entries25:23

    Learn to build an adjusting-entry worksheet in Excel using the accounting equation, turning ending balances into adjusted figures for the balance sheet, income statement, and equity.

  • 10180 Adjusting Entry Accrued Interest28:17

    Learn to record accrued interest as an adjusting entry in Excel, using an amortization table to separate interest from principal and reflect timing on the income statement and balance sheet.

  • 10260 Adjusting Entry Accounts Receivable Sales23:40

    Learn how adjusting entries for accounts receivable align with the accounting equation in Excel, mirroring invoices with journal entries and planning reversals for proper cutoff.

  • 10340 Adjusting Entry Prepaid Insurance22:18

    Explore adjusting prepaid insurance in accrual accounting, transferring the consumed portion to insurance expense and updating the balance sheet and income statement, with no reversing entry.

  • 10380 Adjusting Entry Depreciation31:32

    Demonstrates creating an adjusting entry for depreciation within an Excel-based bookkeeping system, linking fixed assets, accumulated depreciation, and subledger details to the accounting equation under accrual and tax bases.

  • 10400 Adjusting Entry Unearned Revenue Customer Deposit26:08

    Explore adjusting entries for unearned revenue and customer deposits within the accounting equation in Excel. Learn to manage subledgers, negative receivables, and reversing entries for period-end clarity.

  • 10465 Adjusting Entry Loan Payable Short Term & Long-Term Portion27:49

    Break out the loan payable into short-term and long-term portions using an adjusting entry, supported by an amortization table in Excel, to align balance sheet reporting with the accounting equation.

  • 10480 Financial Statements After Adjusting Entries35:17

    Develop accounting equation in Excel to prepare financial statements: balance sheet, income statement, and statement of equity, from adjusting entries and a trial balance, with reversing entries and QuickBooks/Xero.

  • 10500 Closing Entries After Adjusting Entries22:53

    Learn closing entries after adjusting entries using the accounting equation in Excel, including reversing entries, keeping temporary accounts in balance, and linking net income to equity.

Requirements

  • Familiarity with using a computer, including opening and saving files, navigating folders, and using basic software functionalities.
  • A basic understanding of Microsoft Excel, such as creating and formatting worksheets, entering data, using simple formulas (e.g., SUM, AVERAGE), and navigating between sheets.
  • A general understanding of accounting concepts, such as the accounting equation (Assets = Liabilities + Equity), revenue, expenses, and the purpose of financial statements.
  • Participants should have access to Microsoft Excel (2016 or newer) installed on their device.
  • A willingness to engage in hands-on activities and apply theoretical concepts to practical examples.

Description

This comprehensive, hands-on course is designed to bridge the gap between foundational accounting concepts and their practical application in Excel.

The course begins by working with a structured Excel data file containing two months of financial transactions. Instead of using the traditional approach of debits and credits, transactions are formatted using the accounting equation (Assets = Liabilities + Equity) to provide greater clarity and ease of understanding. From there, you will create an Adjusting Entry Worksheet to handle end-of-period adjustments. Participants will learn to identify and process common adjusting entries found in accounting textbooks, such as accruals, deferrals, and depreciation. The course also explores real-world complications, such as unique adjustments encountered when using accounting software, providing valuable insights into professional scenarios.

As the course progresses, you will transition seamlessly from adjustments to generating key financial statements, including the Balance Sheet, which offers a snapshot of the company’s financial position, and the Income Statement, summarizing revenue and expenses to determine profitability. Step-by-step guidance will be provided on formatting these statements in Excel to ensure accuracy, clarity, and compliance with standard accounting practices.

The course concludes by mastering reversing entries, an optional but important part of the accounting cycle. You will learn the rationale behind reversing entries and their role in simplifying bookkeeping for subsequent periods. This section emphasizes the distinction between the adjustment process, which is made at period-end, and the bookkeeping process, which is ongoing.

By the end of the course, participants will master the use of Excel for organizing and processing financial data, develop a clear understanding of the accounting cycle from data input to financial statement preparation, and gain practical experience in handling adjustments, including complex scenarios encountered in real-world accounting. You will also learn to produce financial statements directly from Excel data and understand the theory and application of reversing entries, enabling efficient bookkeeping practices. This course is ideal for students, professionals, and business owners looking to streamline their accounting processes and enhance financial accuracy.

Who this course is for:

  • Those studying accounting or finance who want a practical understanding of how to apply their knowledge to real-world scenarios using Excel.
  • Individuals working in accounting, bookkeeping, or financial management roles who want to enhance their Excel skills and gain hands-on experience with financial processes.
  • Entrepreneurs and small business owners who want to manage their own financial records efficiently and gain insight into their business's financial performance.
  • Professionals transitioning into accounting or finance who want to develop practical skills to build confidence and expertise.
  • Those with a keen interest in using Excel for data management and analysis who wish to explore its application in accounting.
  • Instructors who teach accounting and want to integrate practical Excel-based exercises into their teaching.

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