Accounting Cycle

Muhammad Ismail

GENERAL

JOURNAL

General

Ledger

Trial Balanc

eIncom

e Statement

Owner Equity

Balance

Sheet

Trial Balance

If the journal entries are error-free and were posted properly to the general ledger, the total of all of the debit balances should equal the total of all of the credit balances. If the debits do not equal the credits, then an error has occurred somewhere in the process. The total of the accounts on the debit and credit side is referred to as the trial balance.

Particulars Dr $ Cr $

Cash 51,700

Capital stock 30,000

Notes Payable 3000

Advertising expense 100

Consulting service revenue 20000

Accounts receivable 1200

53,000 53,000

Trial BalanceCompany name

For the Month ended Jan-31-2011

Balance Sheet

A financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time. These three balance sheet segments give investors an idea as to what the company owns and owes, as well as the amount invested by the shareholders.

Balance Sheet

Assets

Cash Truck

Liabilities

Loan

Equity

Retained earnings

Income statement

A financial statement that measures a company's financial performance over a specific accounting period.

the income statement summarizes a company's revenues and expenses quarterly and annually for its fiscal year.

The purpose of the income statement is to report a company's earnings to investors over a specific period of time

Net Income

A = L + OE Increase Decrease increase

Net income is not an assets. Its an increase in owner equity from profit of the business

OE

OE ( Owner equity)

OE

Retained earning

Capital stock

Revenue and expense

Revenue

Increase in owner equity

ExpenseDecrease in

owner equity