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q describe the essential steps in the closing processin accounting we habitually refer to the process of closing as closing the books remember that
q what is income summary accountthe income summary account is a clearing account used merely at the end of an accounting period to summarize revenues
q explain about closing processexpense revenue and dividends accounts are nominal temporary accounts that are merely sub classifications of a real
q example of electronic spreadsheetselectronic spreadsheets have many applications in accounting an electronic spreadsheet is basically a large blank
a few account balances remain the same because no adjustments have affected them for illustration the balance in accounts payable doesnt change and
q preparing a separate trial balanceas an alternative of preparing a separate trial balance as accountants uses the trial balance columns on a work
q detailed steps for completing the work sheetaccountants use these preliminary steps in preparing the work sheet the following segments describe the
q what do you mean by work sheetthe work sheet is a columnar sheet of a computer spreadsheet or a paper on which accountants summarize information
q career in information systemshave you yet heard the sayings knowledge is power or else information is money when people talk about accounting what
q explain about accounting cyclewhen an event is a measurable business transaction you require adequate proof of this transaction after that you
q completing the accounting cyclesubsequent to studying this chapter you should be able to- recapitulate the steps in the accounting cycle- organize
q learning objectives of trial balance- the cash basis of accounting know revenues when cash is received and recognizes expenses when cash is paid
q explain about accrued liabilitiesaccrued liabilities are liabilities not so far recorded at the end of an accounting period they represent
q explain interest revenueinterest revenue savings accounts exactly earn interest moment by moment hardly ever is payment of the interest made on the
q explain about accrued assetsaccrued assets are assets such like interest receivable or accounts receivable that havent been recorded by the end of
q adjustments for accrued itemsaccrued items need two types of adjusting entries assetrevenue adjustments and liabilityexpense adjustments the first
q what do you mean by unearned revenuea liabilityrevenue adjustment concerning unearned revenues covers situations in which a customer has
q show accumulated depreciation account with examplemicro train credits the depreciation amount to an accumulated depreciation account which is a
q example of accumulated depreciation accountthe accumulated depreciation account doesnt represent cash that is being set aside to change the worn
q illustrate accumulated depreciation accountmicro train place depreciation expense in its income statement and it reports accumulated depreciation
q what is estimated useful lifethe estimated useful life of an asset is the approximate time that a company can use the asset useful life is
q what is asset cost and estimated residual valueasset cost the asset cost is the sum that a company paid to purchase the depreciable assetestimated
q explain about depreciation expensedepreciation expense is the sum of asset cost assigned as an expense to a particular period the method of
q what do you mean by depreciable asseta depreciable asset is a manufactured asset such like a building vehicle machine or piece of equipment that
q explain about depreciationdepreciation just as prepaid rent and prepaid insurance indicate a gradual using up of a previously recorded asset thus