Reviewing the Accounting System
In This Chapter
Reviewing accounting terms
Understanding the fundamental accounting equation
Walking through a trial balance
Becoming familiar with journals and ledgers
Writing journal entries
Adjusting, closing, and reversing entries
There’s no getting around it: you must have a system in place to collect financial information in order to effectively and efficiently produce accurate financial statements. This process of collecting, sorting, and entering accounting data into business accounting software is called the accounting cycle. It’s perhaps not the most stimulating of activities, but following a systematic accounting cycle helps reduce errors and provides a consistent approach to business accounting.
In this chapter, the first step is to get up to speed on the language of accounting. Feeling a little hazy on whether you debit or credit ...