Work Sheet for a Service Business

Slides:



Advertisements
Similar presentations
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning Accounting Concepts Page 152: two new Accounting Concepts: Business Entity – keep business.
Advertisements

The Accounting Cycle As we have learned, accounting is a systematic process of recording the financial transactions of a business and arranging the subsequent.
Chapter 7 7-1, 7-2, & 7-3.
CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 6-1 Creating a Worksheet.
LESSON 6-1 4/17/2017 Creating a Worksheet
LESSON 6-1 Creating a Worksheet
LESSON 6-3 Extending Financial Statement Information on a Work Sheet.
Worksheet for a Service Business
Chapter 7 – Work Sheet for a Service Business
LESSON 6-1 WORK SHEET FOR A SERVICE BUSINESS
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 6-1 Creating a Worksheet Four reasons Accountants use Worksheets; 1.To summarize general.
Work Sheet for a Service Business Creating a worksheet Fiscal/accounting period – the length of time for which a business summarizes and reports.
 Work Sheets Chapter 8. Fiscal Periods  A “fiscal” period (a/k/a “accounting” period) is the amount of time for which a business reports financial information.
Creating a Worksheet.  The length of time for which a business summarizes and reports financial information is called a fiscal period (also known as.
A Worksheet For a service business
CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 6-1 Creating a Worksheet.
CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 6-2 Planning Adjusting Entries on a Work Sheet.
A WORKSHEET FOR A SERVICE BUSINESS Accounting – Chapter 6.
CHAPTER 8 Recording Adjusting Entries and Closing Entries for a Service Business.
CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 6-2 Planning Adjusting Entries on a Work Sheet.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 6-4 Finding and Correcting Errors on the Work Sheet.
Worksheet for a Service Business
CHAPTER 16 Worksheet for a Merchandising Business.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning LESSON 6-1, 6-2, & 6-3 How do you create a Worksheet & Plan Adjusting Entries on a Work Sheet?
Accounting Theory.  Matching expenses with revenue ◦ Recording revenue from business activities and expenses associated with earning that revenue in.
Chapter 6 WORKSHEET FOR A BUSINESS. What we are going to learn:  Introduce the 8 Column Work Sheet  In order to complete a work sheet  Adjustments.
© 2014 Cengage Learning. All Rights Reserved. Learning Targets © 2014 Cengage Learning. All Rights Reserved. Lesson 6-1 Creating a Work Sheet What: Work.
GAAP – Accounting Period Cycle – When changes in financial information are reported for a specific period of time in the form of financial statements Fiscal.
CENTURY 21 ACCOUNTING © Thomson/South-Western LESSON 6-1 Creating a Worksheet.
Chapter 6—Work Sheet for a Service Business
Accounting November 7, 2014 Begin Chapter 6 notes WT/OYO/Application for 6-1 and 6-2.
Today’s Target!  Fri., Oct. 9 th  Students will set up the work sheets for accounting cycle end Agenda  Start Chapter 6 Guiding Question:  “How do.
© 2014 Cengage Learning. All Rights Reserved.
LESSON 6-2 Planning Adjusting Entries on a Work Sheet
Planning Adjusting Entries on a Work Sheet
LESSON 8-1 Recording Adjusting Entries
LESSON 8-1 Recording Adjusting Entries
Chapter 6 Work Sheet for a Service Business
Recording Adjusting and Closing Entries
LESSON 6-2 Planning Adjusting Entries on a Work Sheet
© 2014 Cengage Learning. All Rights Reserved.
© 2014 Cengage Learning. All Rights Reserved.
© 2014 Cengage Learning. All Rights Reserved.
LESSON 6-1 Creating a Work Sheet
LO6 Total and rule the work sheet.
LESSON 6-1 Creating a Worksheet
LESSON 8-1 Recording Adjusting Entries
© 2014 Cengage Learning. All Rights Reserved.
© 2014 Cengage Learning. All Rights Reserved.
LESSON 6-1 Creating a Worksheet
© 2014 Cengage Learning. All Rights Reserved.
Work Sheet for a Service Business
Recording Adjusting and Closing Entries
LESSON 6-1 Creating a Worksheet
LESSON 6-2 Planning Adjusting Entries on a Work Sheet
LESSON 6-1 Creating a Worksheet
© 2014 Cengage Learning. All Rights Reserved.
LESSON 6-2 Planning Adjusting Entries on a Work Sheet
LESSON 6-2 Planning Adjusting Entries on a Work Sheet
Extending Financial Statement Information on a Work Sheet
LESSON 6-2 Planning Adjusting Entries on a Work Sheet
Work Sheet for a Service Business
LESSON 6-1 Creating a Worksheet
© 2014 Cengage Learning. All Rights Reserved.
LESSON 8-1 5/22/2019 CHAPTER 8 Recording Adjusting Entries and Closing Entries for a Service Business.
LESSON 6-3 Extending Financial Statement Information on a Work Sheet
LESSON 6-1 Creating a Worksheet
© 2014 Cengage Learning. All Rights Reserved.
LESSON 6-2 Planning Adjustments on a Work Sheet
Presentation transcript:

Work Sheet for a Service Business Chapter 6 Work Sheet for a Service Business

6.1 Creating a worksheet Fiscal/accounting period – the length of time for which a business summarizes and reports financial information Work sheet – a columnar accounting form used to summarize the general ledger information needed to prepare financial statements Trial balance – a proof of the equality of debits and credits in a general ledger

LESSON 6-2

Accounting Concept: Consistent Reporting – accounting concept when the same accounting procedures are followed in the same way in each accounting period Accounting Period Cycle – accounting concept when changes in financial information are reported for a specific period of time

PREPARING THE HEADING OF A WORK SHEET page 153 Name of Company 1 Name of Report 2 Date of Report 3 LESSON 6-1

PREPARING A TRIAL BALANCE ON A WORK SHEET page 154 2 1. Write the general ledger account titles. 2. Write the general ledger debit account balances. Write the general ledger credit account balances. 1 4 3. Rule a single line across the two Trial Balance columns. 4. Add both the Trial Balance Debit and Credit columns. 5. Write each column’s total below the single line. 3 6. Rule double lines across both Trial Balance columns. 5 6 LESSON 6-1

6.2 Adjusting entries on a work sheet Adjustments – changes recorded on a work sheet to update general ledger accounts at the end of a fiscal period The portions of assets consumed in order to earn revenue become expenses of the business

Accounting Concept: Matching Expenses with Revenue – accounting concept when revenue from business activities and expenses associated with earning that revenue are recorded in the same accounting period

SUPPLIES ADJUSTMENT ON A WORK SHEET page 158 2 3 1 1. Write the debit amount. 2. Write the credit amount. 3. Label the two parts of this adjustment. LESSON 6-2

PREPAID INSURANCE ADJUSTMENT ON A WORK SHEET page 159 2 3 1 1. Write the debit amount. 2. Write the credit amount. 3. Label the two parts of this adjustment. LESSON 6-2

PROVING THE ADJUSTMENTS COLUMNS OF A WORK SHEET page 160 1 2 3 1. Rule a single line. 2. Add both the Adjustments Debit and Credit columns. Write each column’s total. 3. Rule double lines. LESSON 6-2

1 2 496400 10000 15000 11000 102500 120000 20000 5000 500000 62500 356500 21300 2800 30000 (a) 71500 3 (b) 10000 4 5 881500 881500 81500 81500 LESSON 6-2

6.3 Financial statement information on a Work Sheet Balance Sheet – a financial statement that reports assets, liabilities, and owner’s equity on a specific date Income Statement – a financial statement showing the revenue and expenses for a fiscal period Net income – when total revenue is greater than total expenses Net loss – when total expenses is greater than total revenue

Chart of accounts

EXTENDING BALANCE SHEET ACCOUNT BALANCES ON A WORK SHEET LESSON 6-3 2/16/2019 EXTENDING BALANCE SHEET ACCOUNT BALANCES ON A WORK SHEET page 162 2 1 3 1. Debit balances without adjustments 2. Debit balances with adjustments 3. Credit balances without adjustments LESSON 6-3

EXTENDING INCOME STATEMENT ACCOUNT BALANCES ON A WORK SHEET page 163 1 2 3 1. Sales balance 2. Expense balances without adjustments 3. Expense balances with adjustments LESSON 6-3

RECORDING NET INCOME, TOTALING AND RULING A WORK SHEET page 164 4 1 2 3 5 6 7 1. Single rule 2. Totals 4. Extend net income 6. Totals 3. Net income 5. Single rule 7. Double rule LESSON 6-3

CALCULATING AND RECORDING A NET LOSS ON A WORK SHEET page 165 1 2 3 4 1. Single rule 2. Totals 3. Net loss 4. Extend net loss LESSON 6-3

1 2 496400 10000 15000 11000 102500 120000 20000 5000 500000 62500 356500 21300 2800 30000 496400 10000 15000 31000 110000 20000 5000 500000 62500 6 (a) 71500 3 (b) 10000 4 11000 21300 2800 30000 356500 10000 71500 7 5 881500 881500 81500 81500 146600 356500 734900 525000 Net Income 8 209900 209900 9 356500 356500 734900 734900 LESSON 6-2

4.4 Finding and Correcting Errors on the Work Sheet Calculation Errors: The difference is 1 ($.01, $.10, $1.00, $10) Most likely addition The difference can be divided evenly by 2 Look for half the difference see if it was placed in the wrong column (ex: $48 difference look for a $24 amount in the incorrect column) The difference can be divided evenly by 9 Look for transposed numbers (ex: $45 written as $54) or look for a slide (ex: $12 written as $120) The difference is an omitted amount Look for the exact amount on the worksheet (ex: $253 as miscellaneous expense)

Finding and Correcting Errors on the Work Sheet Work Sheet – complete in pencil and simply erase Ledger…

CORRECTING AN ERROR IN POSTING TO THE WRONG ACCOUNT LESSON 6-4 2/16/2019 CORRECTING AN ERROR IN POSTING TO THE WRONG ACCOUNT page 168 2 Correct entry 1 Incorrect entry 1. Draw a line through the entire incorrect entry. Recalculate the account balance and correct the work sheet. 2. Record the posting in the correct account. Recalculate the account balance, and correct the work sheet. LESSON 6-4

CORRECTING AN INCORRECT AMOUNT page 169 2 1 3 1. Draw a line through the incorrect amount. 2. Write the correct amount just above the correction in the same space. 3. Recalculate the account balance, and correct the account balance on the work sheet. LESSON 6-4

CORRECTING AN AMOUNT POSTED TO THE WRONG COLUMN page 169 1 2 3 5 4 6 4. Draw a line through the incorrect item in the account. 5. Record the posting in the correct amount column. 6. Recalculate the account balance, and correct the work sheet. LESSON 6-4