End of period

1. Key the adjusting entries
2. Check the trial balance
3. Prepare financial statements
4. Closing entries
5. Post closing trial balance

Worksheet

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A worksheet is used to organize the general journal and prepare financial statements. There are 4 reasons a worksheet is used.
1. Sum up general ledger balances.
2. Plan changes on accounts and update accounts.
3. Separate general ledger and financial statement balances.
4. Calculate net income
(see image 1. click to enlarge)

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Adjusting Entries

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These entries get all journal accounts up to date. These are recorded at the end of the fiscal period. For example, to record an adjusting entry you flip around the accounts. If supplies were recorded after the fisical period, credited for $200 and supplies expense debited for $200. Then the adjusting entry is a debit to supplies and a credit to supplies expense.

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Closing Entries

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A closing entry is also known as a temporary account. All of the closing accounts must have a zero balance at the end of the period.

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Financial Statements

Balance sheet- This is a financial statement that reports assets, liabilities, and owner's equity.
Income statement-This financial statement shows all the revenue and expenses for a fiscal period.
Statement of owner's equity-The financial statement that shows the changes in the corporation's ownership throughout the fiscal period.
Cash flow statement-A financial statement that shows the sources and use of the cash in the business.
Statement of stockholder's equity-Shows change in the corporation's ownership. This is similar to statement of owner's equity.

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