Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

3. Accrual Accounting Concepts

Unadjusted vs Adjusted Trial Balance

Financial Accounting

3. Accrual Accounting Concepts

Unadjusted vs Adjusted Trial Balance

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Multiple Choice

Which of the following best describes the process of preparing an adjusted trial balance from an unadjusted trial balance?

Only post the adjusting entries to the T-accounts, ignoring the unadjusted trial balance.

Combine the unadjusted and adjusted trial balances without posting to T-accounts.

Post the balances from the unadjusted trial balance and then record the effects of adjusting entries in the T-accounts before preparing the adjusted trial balance.

Prepare the adjusted trial balance first, then record the adjusting entries in the T-accounts.

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Verified step by step guidance

Step 1: Understand the purpose of an adjusted trial balance. It is prepared to ensure that all adjusting entries are accurately reflected in the accounts before financial statements are created.

Step 2: Begin with the unadjusted trial balance, which lists the balances of all accounts before any adjustments are made.

Step 3: Post the adjusting entries to the T-accounts. Adjusting entries are made to account for accrued revenues, accrued expenses, depreciation, and other necessary adjustments to reflect the true financial position.

Step 4: Update the balances in the T-accounts after posting the adjusting entries. This ensures that the accounts reflect the effects of the adjustments.

Step 5: Prepare the adjusted trial balance by listing the updated balances from the T-accounts. This adjusted trial balance will be used as the basis for preparing the financial statements.