| << General Ledger | >> Financials – Trial Balance |
This Post is a listing of which General Ledger Accounts are used by which Financial Statement.
Trial Balance: All Accounts
| Account | Description | Debits | Credits |
| 1000 | Checking Account (Cash) | $44,350 | |
| 1200 | Accounts Receivable | $0 | |
| 1500 | Office Equipment | $1,300 | |
| 1520 | Office Furniture | $1,650 | |
| 1590 | Accumulated Depreciation | $496 | |
| 2000 | Accounts Payable | $1,700 | |
| 4000 | Sales | $50,000 | |
| 7000 | Rent | $3,000 | |
| 7020 | Office Supplies | $150 | |
| 7040 | Subscriptions | $300 | |
| 7060 | Utilities | $125 | |
| 7100 | Fuel | $275 | |
| 7200 | Repairs and Maintenance | $500 | |
| 7240 | Depreciation Expense | $496 | |
| 7300 | Credit Card Interest and Fees | $50 | |
| Totals | $52,196 | $52,196 |
Trial Balance: Income Statement Accounts Only
| Account | Description | Debits | Credits |
| 4000 | Sales | $50,000 | |
| 7000 | Rent | $3,000 | |
| 7020 | Office Supplies | $150 | |
| 7040 | Subscriptions | $300 | |
| 7060 | Utilities | $125 | |
| 7100 | Fuel | $275 | |
| 7200 | Repairs and Maintenance | $500 | |
| 7240 | Depreciation Expense | $496 | |
| 7300 | Credit Card Interest and Fees | $50 | |
| Totals | $4,896 | $50,000 | |
| Difference = Net Income | $45,104 |
Trial Balance: Balance Sheet Accounts Only
These example accounts do not have beginning balances and no equity contributions. If there had been equity contributions the equity accounts would also be included in this section of the trial balance.
| Account | Description | Debits | Credits |
| 1000 | Checking Account | $44,350 | |
| 1200 | Accounts Receivable | $0 | |
| 1500 | Office Equipment | $1,300 | |
| 1520 | Office Furniture | $1,650 | |
| 1590 | Accumulated Depreciation | $496 | |
| 2000 | Accounts Payable | $1,700 | |
| Totals | $47,300 | $2,196 | |
| Difference = Net Income | $45,104 |
Statement of Cash Flows: This Statement documents both the change in Cash Position and the change in Financial Position. The Statement of Cash Flows is essentially a Yearly Balance Sheet with an emphasis on Cash.
Notice that debits and credits are presented in the way that they contribute to cash. This report might take some adjusting to as the +/- of all debit and credit accounts except Cash are reversed.
| Statement of Cash Flows | |
| Cash Flows From Operating Activities | |
| Net Income | $45,104 |
| (add back expenses that did not involve cash or cash substitutes) | |
| Depreciation (see Bal Sheet Account 1590) | $496 |
| Increase in Payables (see Bal Sheet Account 2000) | $1,700 |
| ———— | |
| Net Cash Provided by Operating Activities | $47,300 |
| ———— | |
| Cash Flows From Investing Activities | |
| Increase in Fixed Assets (see Bal Sheet Accounts 1500 & 1520) | -$2,950 |
| ———— | |
| Net Cash Used by Investing Activities | -$2,950 |
| ———— | |
| Cash Flows From Financing Activities | |
| (no increase in long term liabilities or equity) | $0 |
| ———— | |
| Net Cash Provided by Financing Activities | $0 |
| ———— | |
| Increase in Cash and Cash Equivalents (Net Cash Flow) |
$44,350 |
| Cash and Cash Equivalents at Beginning of Year |
$0 |
| ———— | |
| Cash and Cash Equivalents at End of Year (see bal sheet acct 1000) | $44,350 |
Next up: >> Financials – Trial Balance
**disclaimer: All information posted on this blog is from my own experience and training. The guidelines I present are general and in my experience, standard practice. I do not write with authority from any Accounting Standards Boards.
