What is the Difference Between Accruals and Deferrals in Adjusting Entries? The purpose of adjusting entries is to bring revenues and the associated expenses into the same accounting periods. The...
Category: Accounting Basics
When a Journal Entry is made to record a transaction, that Journal Entry is then entered (posted) in the accounts being impacted. For example, when rent is paid, in the journal entry Rent Expense is...
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...
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...