{"id":3089,"date":"2020-10-08T22:11:11","date_gmt":"2020-10-08T22:11:11","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/wm-financialaccounting\/?post_type=chapter&p=3089"},"modified":"2020-11-18T05:25:54","modified_gmt":"2020-11-18T05:25:54","slug":"introduction-to-preparing-financial-statements","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/suny-clinton-financialaccounting\/chapter\/introduction-to-preparing-financial-statements\/","title":{"raw":"Introduction to Preparing Financial Statements","rendered":"Introduction to Preparing Financial Statements"},"content":{"raw":"

What you'll learn to do:\u00a0Use an adjusted trial balance to prepare financial statements<\/h2>\r\n\"StepLet's look back at the questions we asked when you first met Nick Frank and his business at the end of October:\r\n
    \r\n \t
  1. How much money did Nick make or lose during his first month in business?<\/li>\r\n \t
  2. Nick wants to buy another truck for $5,000 in order to keep up with demand\u2014does he have enough cash in the bank to do that right now?<\/li>\r\n \t
  3. How much do customers owe Nick?<\/li>\r\n \t
  4. How much does Nick owe to his suppliers?<\/li>\r\n \t
  5. What is Nick's equity in his business at the end of October?<\/li>\r\n<\/ol>\r\nNow we should be able to answer these questions by creating some basic financial statements from the adjusted trial balance.\r\n
    \r\n

    The Accounting Cycle<\/h3>\r\n
      \r\n \t
    1. Analyze Transactions<\/li>\r\n \t
    2. Prepare Journal Entries<\/li>\r\n \t
    3. Post Journal Entries<\/li>\r\n \t
    4. Prepare Unadjusted Trial Balance<\/li>\r\n \t
    5. Make Adjusting Journal Entries<\/li>\r\n \t
    6. Prepare Adjusted Trial Balance<\/li>\r\n \t
    7. Prepare Financial Statements<\/li>\r\n \t
    8. Prepare Closing Entries<\/li>\r\n \t
    9. Prepare Post-Closing Trial Balance<\/li>\r\n \t
    10. Create and Post Reversing Entries, if needed<\/li>\r\n<\/ol>\r\n<\/div>","rendered":"

      What you’ll learn to do:\u00a0Use an adjusted trial balance to prepare financial statements<\/h2>\n

      \"StepLet’s look back at the questions we asked when you first met Nick Frank and his business at the end of October:<\/p>\n

        \n
      1. How much money did Nick make or lose during his first month in business?<\/li>\n
      2. Nick wants to buy another truck for $5,000 in order to keep up with demand\u2014does he have enough cash in the bank to do that right now?<\/li>\n
      3. How much do customers owe Nick?<\/li>\n
      4. How much does Nick owe to his suppliers?<\/li>\n
      5. What is Nick’s equity in his business at the end of October?<\/li>\n<\/ol>\n

        Now we should be able to answer these questions by creating some basic financial statements from the adjusted trial balance.<\/p>\n

        \n

        The Accounting Cycle<\/h3>\n
          \n
        1. Analyze Transactions<\/li>\n
        2. Prepare Journal Entries<\/li>\n
        3. Post Journal Entries<\/li>\n
        4. Prepare Unadjusted Trial Balance<\/li>\n
        5. Make Adjusting Journal Entries<\/li>\n
        6. Prepare Adjusted Trial Balance<\/li>\n
        7. Prepare Financial Statements<\/li>\n
        8. Prepare Closing Entries<\/li>\n
        9. Prepare Post-Closing Trial Balance<\/li>\n
        10. Create and Post Reversing Entries, if needed<\/li>\n<\/ol>\n<\/div>\n\n\t\t\t
          \n\t\t\t

          Candela Citations<\/h3>\n\t\t\t\t\t
          \n\t\t\t\t\t\t
          \n\t\t\t\t\t\t\t
          CC licensed content, Original<\/div>