Chapter 6 Vocab
Terms in this set (17)
The length of time for which a business summarizes and reports financial information.
A columnar accounting form used to summarize the general ledger information needed to prepare financial statements.
A proof of the equality of debits and credits in the general ledger.
A financial statement that reports assets, liabilities and owner's equity on a specific date. Show financial condition.
A financial statement showing the revenue and expenses for a fiscal period. Shows progress over a period of time.
The difference between total revenue and total expenses when total revenue is greater.
The difference between total revenue and total expenses when total expenses is greater.
Changes recorded on a work sheet to update general accounts at the end of a fiscal period.
Four steps to preparing a work sheet
1. Prepare a trial balance (proof of GL)
2. Prepare adjustments
3. Extend accounts to the Financial statement columns
4. Find net income/loss and finish the work sheet
Revenue - Expenses =
Expenses - Revenue
Which accounts are extended to the balance sheet columns?
Owner's Equity (Capital
Which accounts are extended to the Income Statement columns?
Which accounts are affected by adjustments?
If the columns don't match and the difference is an even 1 then your error is most likely . . .
If the columns don't match and the difference is evenly divisible by 9 then your error is most likey . . .
slide or transposition
If the columns don't match and the difference is evenly divisible by 2 then . . .
look for a number equal to it
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