Apply the accounting cycle by recording transactions through journalizing, posting, and preparing trial balances, then making adjusting entries for accruals and deferrals, closing, optional reversing entries, and producing financial statements.

Learn the journalizing process by recording transactions in the general journal in chronological order, using debit and credit rules to maintain double-entry accuracy, with examples of simple and compound entries.

Post journal entries to general ledger using the three column ledger (date, explanation, reference, debit, credit, balance). Record cash and owner’s capital with codes 101 and 301 to verify balances.

Understand how subsidiary ledgers manage accounts receivable and accounts payable with a control account, enabling dual posting to subsidiary and general ledgers, often in real time.

Explore how the trial balance lists all general ledger accounts with their balances, shows debit and credit columns, and serves as a checkpoint to detect errors in a double-entry system.

Compare accrual and cash basis, showing revenue recognized when earned and expenses incurred. Explain GAAP and IFRS restrictions and how accrual improves comparability and avoids misleading cash-based reporting.

Explore why adjusting entries record revenues when services are performed and expenses when incurred, guided by the periodicity assumption, revenue recognition, and the matching principle.

Explore the structure of adjusting entries by distinguishing deferrals and accruals, including prepaid expenses and unearned revenues, and see how they affect income statement and balance sheet accounts.

Deferrals postpone expense recognition and create prepaid expenses as assets; this lesson explains how adjusting entries transfer costs to expenses for items like insurance, rent, and supplies.

Explore unearned revenues, a liability created when cash is received before services, and how adjusting entries recognize revenue as services are performed, with advertisement services as a key example.

Explain accrued expenses by detailing adjusting entries for accrued interest and salaries, and illustrate calculating monthly interest on a note payable and the resulting journal entries.

Explore accrued revenues: revenues earned but not yet billed, and the adjusting entries, including accrued revenue and advertisement revenue, and how billing and cash receipts finalize the process.

Explore how the adjusted trial balance is prepared after posting adjusting entries, demonstrates the equality of total debits and credits, and serves as the primary tool for financial statements.

Learn how to close books by transferring temporary accounts—revenues, expenses, and owner’s drawing—to permanent accounts via income summary, with a note on retained earnings for corporations.

Learn closing entries by classifying temporary and permanent accounts and posting revenues, expenses, and drawings to owner’s capital, using income summary to determine net income.

Prepare the post-closing trial balance to list permanent accounts and carry balances forward after closing temporary accounts. Verify that debits equal credits to confirm the accounting equation is in balance.

Explore how reversing entries, an optional step in the accounting cycle, simplify recording after adjusting entries by reversing their effects on salaries and office supplies.

Explore the classified balance sheet, with current and non-current assets and liabilities, learn the operating cycle and key items like cash, inventory, property, plant and equipment, intangibles, and owner's equity.

Practice the accounting cycle by journalizing December transactions, preparing trial balances, adjusting entries, financial statements, and the post-closing trial balance.

Record Dec 2019 transactions via journal entries using debits and credits to assets, liabilities, and equity, including cash, accounts payable, and service revenue.

Post journal entries to the general ledger by recording debits and credits in each ledger, including cash, owner’s capital, and other accounts, with dates, explanations, journal page numbers, and balances.

Create a four-column trial balance table recording account number, account name, debit balances, and credit balances, and verify totals balance under the double-entry system.

Record adjusting entries for Dec 31, 2019, including unbilled service revenue, depreciation expense, insurance expense, supplies expense, and accrued salaries through journal postings.

Prepare the adjusted trial balance after recording adjusting entries. See how accrued revenue, depreciation expense, insurance expense, supplies expense, and salaries expense affect balances to ensure debits equal credits.

Prepare three financial statements—the income statement, the statement of changes in equity, and the classified balance sheet—showing revenues and expenses, net income, owner’s capital changes, and assets, liabilities, and equity.

Close revenues and expenses to income summary, post entries with dates and references, then close income summary and owner’s drawing to owner’s capital, preparing for a post-closing trial balance.

Close temporary accounts in the owner's capital and prepare the post-closing trial balance, showing permanent accounts and an ending capital of $21,000, with debits equal to credits.

Explore merchandising companies, including retailers and wholesalers, and their income statements with cost of goods sold, gross profit, and operating expenses, plus the longer operating cycle and inventory flow.

Compare perpetual and periodic systems, showing perpetual records inventory and cost of goods sold in real time, while periodic uses purchases and end-period counts to compute cost of goods sold.

Record purchases under the perpetual system using journal entries, debiting inventory and crediting accounts payable, and cover returns, discounts, and freight terms that affect ending inventory.

Learn how to record inventory sales under the perpetual system with journal entries for revenue recognition, cost of goods sold, returns, allowances, discounts, and freight effects.

Learn how to close temporary accounts under the perpetual system for a merchandising company, including sales returns and allowances, sales discount, cost of goods sold, and freight-out.

Learn how a merchandising company uses a multiple-step income statement to compute net sales, gross profit, operating income, other revenues and gains, other expenses and losses, and net income.

Examine why inventory valuation matters and how costs from purchase price, freight, handling, and overhead affect cost of goods sold and ending inventory using FIFO, LIFO, specific identification, weighted average.

Learn the specific identification method for inventory valuation, tracing each item's original cost to allocate the cost of goods sold and ending inventory, with advantages and practical challenges.

Apply the first-in, first-out method in periodic or perpetual systems to allocate cost of goods sold and ending inventory, using oldest purchases for COGS.

Learn how the last-in, first-out method assigns the latest purchases to cost of goods sold, while ending inventory reflects the oldest units, in both periodic and perpetual systems.

Apply the weighted average method to compute cost of goods sold and ending inventory under periodic and perpetual systems, using moving-average costs after each purchase.

Compare how fifo, lifo, and weighted average affect the income statement under inflation, showing higher net income with fifo and lower with lifo, with consistency guiding method changes.

Apply the lower of cost or market rule using current replacement cost and conservatism, choosing item, group, or inventory-wide methods for adjustments under cost of goods sold, loss, or allowance.

Explore July 2020 inventory cycle under a perpetual system, calculating ending inventory and cost of goods sold under FIFO, LIFO, and moving-average, then journalizing and preparing a multi-step income statement.

Demonstrates the fifo method under a perpetual system using July 2020 inventory transactions, calculating cost of goods sold and ending balances on a detailed stock card.

Apply the last-in, first-out method under a perpetual system to calculate cost of goods sold and ending inventory through a July sequence of purchases, sales, and returns.

Apply the moving-average method under a perpetual system to calculate weighted average cost, cost of goods sold, and ending inventory amid sales and purchase returns.

Apply moving-average cost under a perpetual system to journal purchases, sales, and returns. Track inventory, cost of goods sold, accounts receivable, accounts payable, and revenue with end balances.

Compare FIFO, moving-average, and LIFO in a 1-month, multiple-step income statement, showing net sales, cost of goods sold, gross profit, and net income under 30% tax.

Explore how cash and cash equivalents are reported in the balance sheet and cash flows, detailing cash on hand, bank drafts, money orders, petty cash, and cash in banks.

Identify cash equivalents as short-term, highly liquid investments easily convertible to cash near maturity, usually three months or less at acquisition, classified as current assets, or non-current if longer.

Restricted cash is cash not available for general use, held for a specific purpose, such as escrow collateral or compensating balances, and is reported separately in the balance sheet.

Examine bank overdrafts, where negative balances occur when checks exceed available funds, and describe credit line facilities, and U.S. GAAP vs IFRS treatments as current liabilities or cash equivalents.

Learn how to manage a petty cash fund under the imprest system by establishing the fund, authorizing payments with documented vouchers, and reimbursing the fund to maintain accurate financial statements.

Strengthen cash control by using bank accounts to safeguard funds and reconcile records. Explore deposits, checks, and electronic fund transfers, including payroll via EFT and bank statements across multiple accounts.

Learn to perform a bank reconciliation that matches balance per bank to balance per books, adjusting for deposits in transit, outstanding checks, and bank errors.

Solve a bank reconciliation exercise by comparing bank statement records with company ledgers and prepare journal entries to adjust cash balances.

Prepare Sep 2020 bank reconciliation by comparing bank statement with the company ledger, adjusting for charges, NSF checks, EFTs, and deposits in transit to reach an adjusted balance of 2,930.

Develop journal entries to adjust company books for bank reconciliation as of September 30, 2020, including correcting check #511, recording bank charges, NSF checks, and electronic fund transfers.

Explore accounts receivable, notes receivable, and other receivables as liquid assets and balance-sheet items arising from credit sales and non-operational sources.

The direct write-off method records uncollectible receivables by debiting bad debt expense and crediting accounts receivable, which lacks matching with sales and reports gross receivables.

Learn how the allowance method estimates uncollectible accounts at period end, records bad debt expense and a contra allowance for doubtful accounts, and reports accounts receivable at net realizable value.

Explore estimating bad debts under the allowance method, using percentage of sales or receivables, and applying aging schedules to calculate bad debt expense and adjust the allowance.

Explore selling receivables to a factor to convert receivables into cash, with typical fees 1% to 3%, and record cash net of fees, factoring expense, and accounts receivable.

Identify how credit cards involve an issuer, the customer, and the seller, and record credit card sales as cash sales with sales revenue after deducting 2% bank charges.

Learn how promissory notes govern notes receivable, including face value, issue date, maturity date, interest calculation, time factors, and maturities (on demand, fixed date, or term).

Record notes receivable in three cases—against credit sales, lending, and past-due extension—and apply entries for collection, interest revenue, dishonor, and write-off.

Apply the percentage of receivables method to estimate bad debts and complete the aging report for accounts receivable as of September 30, 2020 under 2/10 n/30, including the adjusting entry.

Prepare the aging report for accounts receivable, classify by not due and 1–30, 31–60, 61–90, over 90 days, and compute uncollectible values with the percentage of receivable method.

Perform the adjusting entry to reduce allowance for doubtful accounts and bad debt expense by $1,700, and show the resulting net realizable value of accounts receivable in the balance sheet.