form the basis of entries in the general journal

Posting process is usually made in

The heading of the trial balance consists of the following:

What are the bodies of trial balance

What type of error when an incorrect account title is used to record a transaction.

posting error oftentimes committed during the sorting process. It happens when the different digits of the amount are inadvertently rearranged during posting.

Also known as a sliding error, occurs when the placement of a decimal point indicating cents is incorrect. This mistake can cause the debit or credit amount in the journal to increase or decrease by one, ten, or hundred units.

simply ensure that account balances reflect current information. assume correctness at the time of recording.which assume no errors during recording.

What is the primary difference between journal entries and adjusting entries

are made to ensure that financial statements accurately depict the true financial position of the business.

adjusting entries are also called

recognize transactions that have occurred but haven't been recorded yet as of the cut-off date.

help adjust expense accounts due to accruals by providing pre-filled debit and credit account titles. You just need to add the amount of the accrual to complete the entry.

is revenue earned but not yet received. This means the business has already earned the money, but it will be collected later.

It updates accounts because transactions have been recorded for future periods. Means income or expenses are recognized later, not when they occur.

expenses of the business that are paid in advance. These are disbursements made by the business that benefit the future accounting period. In other words, are expenses paid by the business now, but will be utilized in the future.

when customers pay in advance for services they'll receive later. This money isn't considered income yet because the services haven't been provided. It remains unearned revenue until the services are rendered.

treats pre-collected amounts as income when received, also called the nominal approach

suggests that liability account is credited upon receipt of precollection. This method is also known as real approach of precollection

encompasses the purchase price of the asset along with any additional expenses essential for acquiring and preparing it for use.

-refers to the worth of an asset at disposal. -represents the estimated amount a business expects to receive upon disposal, determined through professional judgment.

the duration during which depreciable assets remain productive. It's influenced by factors such as technological advancements, obsolescence, production volume, or service hours.

based on the assumption that the cost of the asset is equally divided over its useful or productive life. In other words, the entire productive life of the asset, will have equal amounts of depreciation.

is the gap between the cost and accumulated depreciation of an asset.

cost is equal to the difference between cost and residual value. example, if the total cost of acquiring machinery is P3,000,000 and the estimated residual value at the end of its productive life is P200,000, then depreciable cost is equal to P2,800,000

is the sum of depreciation in direct relation with the expired life of the asset.