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COB 241

COB 241. September 4, 2019. Administration. Tutoring Schedule is on the Course Materials Web Page. COB 241 – UNIT 4. Entity Principle. Period Principle. INCOME STATEMENT & BALANCE SHEET. For the period ending (date). As of (date). CLOSING DATE.

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COB 241

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  1. COB 241 September 4, 2019

  2. Administration • Tutoring Schedule is on the Course Materials Web Page

  3. COB 241 – UNIT 4

  4. Entity Principle Period Principle INCOME STATEMENT & BALANCE SHEET For the period ending (date) As of (date) CLOSING DATE

  5. CLOSING the Books

  6. Keeping the books

  7. Keeping the books

  8. Closing the books Adjusted Trial Balance Prepare Income Statement Unadjusted Trial Balance Adjusting Entries = 55 55

  9. Closing the books Closing Entry

  10. Closing the books Prepare Balance Sheet

  11. Closing the books For the period ending (date) As of (date)

  12. Closing the books

  13. Unadjusted Trial Balance Period 2 Adjusting Entries Adjusted Trial Balance Income Statement Statement of Changes in Equity 89 = 89

  14. Period 2 Closing Entry

  15. Closing Entry Period 2 Prepare Balance Sheet

  16. Period 2 Closing Entry Prepare Balance Sheet

  17. Activities involved in “Closing” • Prepare UNADJUSTED TRIAL BALANCE • Record ADJUSTING ENTRIES • Prepare ADJUSTED TRIAL BALANCE • Prepare Income Statement • Prepare Statements of CASH FLOWS, CHANGES IN OWNER’S EQUITY • Record CLOSING ENTRY • Prepare the BALANCE SHEET • OPEN the new period

  18. So what the heck are ADJUSTING ENTRIES?

  19. Adjusting Entries Accruals Expenses not yet billed Sales not yet billed Accrued Salaries and Wages Accrued Interest Revenue and expenses that are RECOGNIZED BEFORE the cash changes hands. Deferrals Supplies Prepaids Unearned Revenue Depreciation Revenue and expenses which are RECOGNIZED AFTER the cash changes hands.

  20. Adjusting Entries FRIDAY Deferrals Supplies Prepaids Unearned Revenue Depreciation Revenue and expenses which are RECOGNIZED AFTER the cash changes hands.

  21. HOMEWORK ASSIGNMENT 4 • Individual part • Group part • Complete before Friday

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