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Basic Accounting - Year End Adjustments Cheat Sheet (DRAFT) by

Basic Accounting notes

This is a draft cheat sheet. It is a work in progress and is not finished yet.

Deprec­iation

GL Acc Impact­ed:
Deprec­iation (Expe­nse) Debit
Accumu­lated Deprec­iation (Negative Asset) Credit
*
Stra­igh­-line Method:
Annual fixed percentage
Asset value x % = Annual Deprec­iation
Example: Vehicle Cost =R120,000 x 20% = R24,000
*
Reducing Balance Method:
Annual percentage of reduced value
Reduced Asset Value x % = Annual Deprec­iation
Example: Remaining Vehicle Cost = R120,000 - R24,000 = R96,000 x 20% = R19,200
 

Credit Losses

Increase Allowance for Credit Losses
Credit Losses (Expe­nse) Debit
Allowance for Credit Losses (Negative Asset) Credit
*
Decr­easing Allowance for Credit Losses
Allowance for Credit Losses (Negative Asset) Debit
Credit Losses (Expe­nse) Credit
*
Writing off Credit Losses when allowance for credit losses does NOT exist
Credit Losses (Expe­nse) Debit
Debtors Control (Current Asset) Credit
*
Writing off Credit Losses when allowance for credit losses DOES exist
Allowance for Credit Losses (Negative Asset) Debit
Debtors Control (Current Asset) Credit
*
Creating an Allowance for Credit Losses
Credit Losses (Expe­nse) Debit
Allowance for Credit Losses (Negative Asset) Debit
 

Pre-paid Expenses

Prepaid Expenses (Expe­nse) Debit
GL Expense Account (Expe­nse) Credit
Example: Prepaid Exepenses DR 1000 and Insurance CR 1000

Accrued Expenses

GL Expense Account (Expe­nse) Debit
Accrued Expenses (Expe­nse) Credit

Example

Water and Electr­icity DR 500 and Accrued Expenses CR 500

Accrued Income

Accrued Income *(Income) Debit
GL Income Account (Income) Credit
Example: Accrued Income DR 2500 and Rent CR 2500

Income Received in Advance

GL Income Account (Income) Debit
Income Received in Advance (Income) Credit
Example: Rent Received DR 2100 and Income Received in Advance CR 2100