A simple illustration will help reinforce what you've learned about the relationship of assets, liabilities, owners' equity, revenues, expenses, and dividends, as well as the mechanics of the double-entry accounting system.
- Okay, a simple illustration … will help reinforce what you've learned … about the relationship of assets, liabilities, … owner's equity, revenues, expenses, and dividends, … as well as the mechanics … of the double entry accounting system. … Catherine Coller established … the Double K Corporation in 2012. … The journal entries to record the transactions … of Double K Corporation are shown in the next section. … Note here that we've used letters … in place of dates. … Now, let's quickly walk through … each of these journal entries … and see if we can tell what they mean. … For entry a, cash is being increased. … But we know what that means, … because it's being debited. … And capital stock and equity account … is being increased as well. … It looks like capital stock was issued … in exchange for $20,000. … For entry b, inventory is being debited. … Since inventory is an asset … and assets increase with debits, … we must have purchased inventory. … And since cash, another asset, is being credited, …
- Identify how a balance sheet reflects the accounting equation.
- Name the account where debits are increases and credits are decreases.
- Define a journal.
- List the three things, in order, that you must address when making journal entries.
- Explain the function of financial statements that is most important for entrepreneurs.
- Assess the purpose of a trial balance.
Skill Level Beginner
1. Review of the Financial Statements
2. Fours Steps in the Bookkeeping Process
3. How Transactions Affect the Accounting Equation
4. The General Ledger
5. Illustration of the First Three Steps in the Accounting Cycle
The role of computers3m 44s
- Mark as unwatched
- Mark all as unwatched
Are you sure you want to mark all the videos in this course as unwatched?
This will not affect your course history, your reports, or your certificates of completion for this course.Cancel
Take notes with your new membership!
Type in the entry box, then click Enter to save your note.
1:30Press on any video thumbnail to jump immediately to the timecode shown.
Notes are saved with you account but can also be exported as plain text, MS Word, PDF, Google Doc, or Evernote.