The Expanded Accounting Equation is a more detailed version of the Basic Accounting Equation that adds details about changes in owner's equity due to day-to-day transactions in the business. It...
Posts by Caroline Grimm
Before you can understand debits and credits, you’ll need a little background on the structure of accounting. It all starts with the Accounting Equation. The Accounting Equation is the foundation...
A T-Account is a simplified version of a Ledger account. A T-account is shaped like the letter T and has a debit (left) column and a credit (right) column. It is used as a visual way to demonstrate...
Owner's Draw or Owner's Withdrawal is an account used to track when funds are taken out of the business by the business owner for personal use. Business owners may use an owner's draw rather than...
Double-entry Accounting is an accounting system that tracks two or more parts of every business transaction. It is based on the Accounting Equation [Assets = Liabilities + Equity]. The equation must...
When all the regular day-to-day transactions of an accounting period are completed, the next step is to check on the balances of certain accounts to see if those balances need to be updated or...