1. The Accounting Process Sid Glandon, DBA, CPA Assistant Professor of Accounting

2. Basic Accounting Equation Assets = Liabilities + Owners’ Equity Owners’ Equity consists of Revenues and gains, less Expenses and losses, plus Contributions by owners, less Withdrawals by owners, plus or less Other comprehensive income

3. Accounting Cycle Transactions and/or events Journalize transactions and/or events Post transactions and/or events Preparation of unadjusted trial balance Preparation of adjusting journal entries Adjusted trial balance Preparation of financial statements Journalize adjusting journal entries Journalize closing journal entries Post adjusting journal entries Post closing trial balance

4. Permanent Accounts Assets Liabilities Owners’ Equity

5. Temporary Accounts Revenue Gains Expenses Losses

6. Conversion from Cash to Accrual Basis Accounting Cash receipts, less Cash disbursements Net cash Add Increases in current asset Decreases in current liabilities Subtract Decreases in current assets Increases in current liabilities Non cash charges (depreciation)