Category Archives for Introduction

Closing Entries Using Income Summary

I imagine some of you are starting to wonder if there is an end to the types of journal entries in the accounting cycle! So far we have reviewed day-to-day journal entries and adjusting journal entries.

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Creating Financial Statements

The four basic financial statements are the income statement, the statement of retained earnings, the balance sheet and the statement of cash flows. Due to the complexity of the statement of cash flows,

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Journal Entry Basics

Journal entries are probably the most important part of any financial accounting class. They are the language of accounting. This is a journal entry. It describes a transaction. The entry above tells

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Adjusting Journal Entries

What are adjusting journal entries? The matching principle states expenses must be matched with the revenue generated during the period. The purpose of adjusting entries is to ensure that all revenue and

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The Accounting Equation

Accounting is all about balance. Each time we engage in a transaction, there are at least two things that are happening. Usually, we give up something to receive something we need. For example, when you

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