Lecture 7

Completing the
Accounting Cycle
Chapter Outline
Learning Objectives
LO 1 Prepare a worksheet.
LO 2 Prepare closing entries and a post-closing trial
balance.
LO 3 Explain the steps in the accounting cycle and how
to prepare correcting entries.
LO 4 Identify the sections of a classified statement of
financial position.
Copyright ©2019 John Wiley & Son, Inc. 3

The Worksheet
• Multiple-column form used in preparing financial
statements
• Not a permanent accounting record
• May be a computerized worksheet
• Prepared using a five step process
• Use of worksheet is optional
LO 1 Copyright ©2019 John Wiley & Son, Inc. 4

Yazici Advertising
Worksheet ILLUSTRATION 4.1
For the Month Ended October 31, 2020 Form for a worksheet
Adjusted Income Statement of
Trial Balance Adjustments Trial Balance Statement Financial Position
Account Titles Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash 15,200 15,200 15,200
Supplies 2,500 (a) 1,500 1,000 1,000
Prepaid Insurance 600 (b) 50 550 550
Equipment 5,000 5,000 5,000
Notes Payable 5,000 5,000 5,000
Accounts Payable 2,500 2,500 2,500
Unearned Service Revenue 1,200 (d) 400 800 800
Owner's Capital 10,000 10,000 10,000
Owner's Drawings 500 500 500
Service Revenue 10,000 (d) 400 10,600 10,600
(e) 200
Salaries and Wages Expense 4,000 (g) 1,200 5,200 5,200
Rent Expense 900 900 900
Totals 28,700 28,700
Supplies Expense
Insurance Expense
Step 1 Step 2
(a) 1,500
(b) 50
Step
1,500
50
3 1,500
50
Step 4
Accumulated Depreciation Prepare a Enter
(c) 40 Enter 40 Extend adjusted 40
Depreciation Expense (c)
trial balance (e)adjustment 40 40
adjusted 40
balances to appropriate
Accounts Receivable 200 200 200
Interest Expense on the (f) data.
50 balances.
50 statement columns.
50
Interest Payable (f) 50 50 50
Salaries and Wages Payable worksheet. (g) 1,200 1,200 Step 5 1,200
Totals 3,440 3,440 30,190 30,190 7,740Total the statement
10,600 22,450 19,590
Net Income 2,860 2,860
Totals 10,600 columns,
10,600 22,450 22,450
compute net income
(or net loss), and
complete worksheet.

Yazici Advertising
Step 1 Worksheet
For the Month Ended October 31, 2020
ILLUSTRATION 4.2
Preparing a trial balance
Statement of
Adjusted Income Financial
Trial Balance Adjustments Trial Balance Statement Position
Cash 15,200 15,200 15,200
Supplies 2,500 (a) 1,500 1,000 1,000
Equipment 5,000 5,000 5,000
Notes Payable 5,000 5,000 5,000
Owner's Capital 10,000 10,000 10,000
(e) 200
Totals 28,700 28,700
Supplies Expense (a) 1,500 1,500 1,500
Insurance Expense (b) 50 50 50
Accumulated Depreciation (c) 40 40 40
Depreciation Expense (c) 40 40 40
Accounts Receivable (e) 200 200 200
Interest Expense (f) 50 Trial balance amounts
50 50 come
Salaries and Wages Payable directly from 1,200
(g) 1,200 ledger accounts. 1,200
Totals 3,440 3,440 30,190 30,190 7,740 10,600 22,450 19,590
Include all accounts
Net Income
Totals
2,860
10,600 10,600 22,450
2,860
22,450
with balances.

Step 2 Enter Adjustments
The adjustments are the same as in Illustration 3.23.
a. Yazici debits an additional account, Supplies Expense, ₺1,500 for the cost of
supplies used, and credits Supplies ₺1,500.
b. Yazici debits an additional account, Insurance Expense, ₺50 for the insurance
that has expired, and credits Prepaid Insurance ₺50.
c. The company needs two additional depreciation accounts. It debits
Depreciation Expense ₺40 for the month’s depreciation, and credits
Accumulated Depreciation—Equipment ₺40.
d. Yazici debits Unearned Service Revenue ₺400 for services performed, and
credits Service Revenue ₺400.
e. Yazici debits an additional account, Accounts Receivable, ₺200 for services
performed but not billed, and credits Service Revenue ₺200.
f. The company needs two additional accounts relating to interest. It debits
Interest Expense ₺50 for accrued interest, and credits Interest Payable ₺50.
g. Yazici debits Salaries and Wages Expense ₺1,200 for accrued salaries, and
credits an additional account, Salaries and Wages Payable, ₺1,200.
Yazici Advertising
Step 2 Worksheet
ILLUSTRATION 4.3
Entering the adjustments
Cash 15,200 15,200 15,200
Supplies 2,500 (a) 1,500 1,000 1,000
Equipment 5,000 5,000 5,000
Notes Payable
Accounts Payable
5,000
2,500
Adjustments
5,000
2,500
Key: 5,000
2,500
Unearned Service Revenue
Owner's Capital
1,200 (d) 400
10,000
(a) Supplies Used
800
10,000
800
10,000
Owner's Drawings 500 500 (b) Insurance Expired 500
(e) 200 (c) Depreciation Expensed
Rent Expense 900 900 (d) Service900 Revenue Recognized
Totals 28,700 28,700
Supplies Expense (a) 1,500 1,500 (e) Service 1,500Revenue Accrued
Accumulated Depreciation (c) 40 (f) 40 Interest Accrued 40
Accounts Receivable (e) 200 200 (g) Salaries Accrued 200
Interest Expense (f) 50 50 50
Salaries and Wages Payable (g) 1,200 Enter
1,200 adjustment amounts, total
1,200
Totals 3,440 3,440 30,190 30,190 7,740 10,600 22,450 19,590
Net Income adjustments2,860 columns, and check 2,860
Totals for equality.
10,600 10,600 22,450 22,450
Add additional accounts as needed.

Yazici Advertising
Step 3 Worksheet
ILLUSTRATION 4.4
Entering adjusted balances
Cash 15,200 15,200 15,200
Supplies 2,500 (a) 1,500 1,000 1,000
Equipment 5,000 5,000 5,000
Notes Payable 5,000 5,000 5,000
Owner's Capital 10,000 10,000 10,000
(e) 200
Totals 28,700 28,700
Salaries and Wages Payable (g) 1,200 1,200 1,200
Totals 3,440 3,440 30,190 30,190 7,740 10,600 22,450 19,590
Totals 10,600 10,600 22,450 22,450
Check equality of adjusted trial balance columns.

Yazici Advertising
Step 4 Worksheet
ILLUSTRATION 4.5
Extending adjusted trial balance amounts
Cash 15,200 15,200 15,200
Supplies 2,500 (a) 1,500 1,000 1,000
Equipment 5,000 5,000 5,000
Notes Payable 5,000 5,000 5,000
Owner's Capital 10,000 10,000 10,000
(e) 200
Totals 28,700 28,700
Totals 3,440 3,440 30,190 30,190 7,740 10,600 22,450 19,590
Totals 10,600 10,600 22,450 22,450
Extend adjusted trial balance amounts to appropriate financial statement columns.

Yazici Advertising
Step 5 Worksheet
ILLUSTRATION 4.6
Compute net income or net loss
Cash 15,200 15,200 15,200
Supplies 2,500 (a) 1,500 1,000 1,000
Equipment 5,000 5,000 5,000
Notes Payable 5,000 5,000 5,000
Owner's Capital 10,000 10,000 10,000
(e) 200
Totals 28,700 28,700
Totals 3,440 3,440 30,190 30,190 7,740 10,600 22,450 19,590
Totals 10,600 10,600 22,450 22,450
Compute net income or net loss.

Preparing Financial Statements from a
Worksheet
• Income statement is prepared from the income
statement columns
• Statement of financial position and owner’s equity
statement are prepared from the statement of
financial position columns

Preparing Statements from a Worksheet
Yazici Advertising
Income Statement
Revenues
Service revenue ₺10,600
Expenses
Salaries and wages expense ₺5,200
Supplies expense 1,500
Rent expense 900
Insurance expense 50
Interest expense 50
Depreciation expense 40
Total expenses 7,740
Net income ₺2,860
ILLUSTRATION 4.7
LO 1 Financial statements from a worksheet Copyright ©2019 John Wiley & Son, Inc. 13
Preparing Statements from a Worksheet
Yazici Advertising
Owner’s Equity Statement
Owner’s capital, October 1 ₺ 0
Add: Investments ₺10,000
Net income 2,860 12,860
12,860
Less: Drawings 500
Owner’s capital, October 31 ₺12,360
ILLUSTRATION 4.7
Yazici Advertising
Statement of Financial Position
October 31, 2020
Assets
Cash ₺15,200
Accounts receivable 200
Supplies 1,000
Prepaid insurance 550
Equipment ₺5,000
Less: Accumulated depreciation 40 4,960
Total assets ₺21,910
Liabilities and Owner’s Equity
Liabilities
Notes payable ₺5,000
Accounts payable 2,500
Interest payable 50
Unearned service revenue 800
Salaries and wages payable 1,200
Total liabilities ₺ 9,550
Owner’s equity
Owner’s capital 12,360
Total owner’s equity and liabilities ₺21,910
ILLUSTRATION 4.7
Closing the Books
At the end of the accounting period, the company
makes the accounts ready for the next period.
Trial Adjusting
Analyze Journalize Post
Balance Entries
Adjusted Post-Closing
Trial
Financial Closing
Trial
Balance Statements Entries
Balance

Closing the Books ILLUSTRATION 4.8
Temporary versus permanent
accounts
TEMPORARY PERMANENT
These accounts are closed These accounts are not closed
All revenue accounts All asset accounts
All expense accounts All liability accounts
Owner's drawings account Owner's capital account

Preparing Closing Entries
Closing entries formally recognize in the ledger the
transfer of:
• Net income (or net loss) to owner’s capital
• Owner’s drawings to owner’s capital
Produce a zero balance in each temporary account.
Companies generally journalize and post closing entries
only at end of the annual accounting period.

Preparing Closing Entries
ILLUSTRATION 4.9
Diagram of closing process—
proprietorship
(Individual) Income (Individual)

Expenses Summary Revenues
2 1
3
Key:
1. Close Revenues to Income Owner’s Owner’s
Summary. Drawings Capital
2. Close Expenses to Income
Summary.
4
3. Close Income Summary to Owner’s
Capital.
4. Close Owner’s Drawings to
Owner’s Capital.

Closing Entries Illustrated ILLUSTRATION 4.10
Closing entries journalized
GENERAL JOURNAL Page J3

Date Account Titles and Explanations Ref. Debit Credit
2020
Oct. 31 Service Revenue 400 10,600
Income Summary 350 10,600
(To close revenue account)
31 Income Summary 350 7,740
Supplies Expense 631 1,500
Depreciation Expense 711 40
Insurance Expense 722 50
Salaries and Wages Expense 726 5,200
Rent Expense 729 900
Interest Expense 729 50
(To close expense accounts)

Closing Entries Illustrated ILLUSTRATION 4.10
Closing entries journalized

2020
Oct. 31 Income Summary 350 2,860
Owner’s Capital 301 2,860
(To close net income to capital)
31 Owner’s Capital 301 500
Owner’s Drawings 306 500
(To close drawings to capital)

Posting
Closing
Entries
ILLUSTRATION 4.11
Copyright ©2019 John

LO 2 22
Wiley & Son, Inc.
Yazici Advertising
Post-Closing Trial Balance
October 31, 2020
Debit Credit
Cash ₺15,200
Accounts Receivable 200
Supplies 1,000
Prepaid Insurance 550
Equipment 5,000
Accumulated Depreciation ₺ 40
Notes Payable 5,000
Accounts Payable 2,500
Unearned Service Revenue 800
Salaries and Wages Payable 1,200
Interest Payable 50
Owner’s Capital 12,360
ILLUSTRATION 4.12
₺21,950 ₺21,950
DO IT! 2 Closing Entries
Hancock Heating has the following balances in selected accounts of
its adjusted trial balance.
Accounts Payable €27,000 Owner’s Drawings €15,000
Service Revenue 98,000 Owner’s Capital 42,000
Rent Expense 22,000 Accounts Receivable 38,000
Salaries and Wages Supplies Expense 7,000
Expense 51,000
Prepare the closing entries at December 31.
Service Revenue 98,000
Income Summary 98,000

Expense 51,000
Salaries and Wages Expense 51,000
Rent Expense 22,000
Supplies Expense 7,000

Expense 51,000
Owner’s Drawings 15,000

The Accounting Cycle
1. Analyze business transactions
9. Prepare a post-closing trial

2. Journalize the transactions
balance
8. Journalize and post closing

3. Post to ledger accounts
entries
7. Prepare financial
4. Prepare a trial balance
statements
6. Prepare an adjusted trial 5. Journalize and post

balance adjusting entries

1. Analyze Business Transactions
Assets Liabilities Owner’s Equity
Accounts Notes Unearned Owner's Owner's
Date Cash +Equipment = Payable + Payable + Revenue + Capital - Drawings +Revenue - Expense
1 +₺10,000 +₺10,000
1 +₺5,000 +₺5,000
2 +1,200 +₺1,200
3 -1,200 -₺1,200
4 +250 -₺250
Partial Schedule

2. Journalize the Transactions
Date Explanation Ref. Debit Credit
2020
Oct. 1 Cash 101 10,000
Owners’ Capital 301 10,000
1 Equipment 157 5,000
Notes Payable 200 5,000
2 Cash 101 1,200
Unearned Revenue 209 1,200
3 Rent Expense 729 900
Cash 101 900
LO 3 ILLUSTRATION 2.29 Copyright ©2019 John Wiley & Son, Inc. 29

3. Post to the Ledger Accounts
On October 1, C. R. Byrd invests ₺10,000 cash in an advertising
Transaction
company called Yazici Advertising.
Date Titles Ref. Debit Credit

Journal
Entry Oct. 1 Cash 101 10,000
Owner's Capital 301 10,000
Cash 101 Owner's Capital 301

Posting
Oct. 1 10,000 Oct. 1 10,000

Yazici Advertising
4. Prepare Trial Balance
October 31, 2020
a Trial Debit Credit
Balance Cash ₺15,200
Supplies 2,500
Equipment 5,000
Notes Payable ₺ 5,000
Unearned Service Revenue 1,200
Owner’s Drawings 500
Rent Expense 900
₺28,700 ₺28,700

5. Journalize and Post Adjusting Entries
Transaction Yazici used supplies costing ₺1,500.
Basic The expense Supplies Expense is increased ₺1,500, and the asset
Analysis Supplies is decreased ₺1,500.
Date Titles Ref. Debit Credit

Journal
Entry Oct. 31 Supplies Expense 1,500
Supplies 1,500
Supplies Supplies Expense

Posting
Oct. 5 2,500 Oct. 31 1,500 Oct. 31 1,500
Oct. 31 1,000 Oct. 31 1,500

Yazici Advertising
Adjusted Trial Balance
6. Prepare
October 31, 2020
Debit Credit
an Adjusted
Cash ₺15,200
Supplies 1,000
Trail Balance Prepaid Insurance
Equipment
550
5,000
Accumulated Depreciation—Equipment ₺ 40
Notes Payable 5,000
Interest Payable 50
Unearned Revenue 800
Owner’s Drawings 500
Supplies Expense 1,500
Rent Expense 900
Insurance Expense 50
Interest Expense 50
ILLUSTRATION 3.25
Depreciation Expense 40
₺30,190 ₺30,190

7. Prepare Financial Statements Partial
Statements
Yazici Advertising
Income Statement
Revenues
Service revenue ₺10,600
Yazici Advertising
Owner’s Equity Statement
Owner’s capital, October 1 ₺ 0
Yazici Advertising
October 31, 2020
Assets
Cash ₺15,200
Accounts receivable 200

8. Journalize and Post Closing Entries
2020
Oct. 31 Service Revenue 400 10,600
Income Summary 350 10,600
(To close revenue account)
31 Income Summary 350 7,740
Supplies Expense 631 1,500
Depreciation Expense 711 40
Partial Insurance Expense 722 50
Schedule Salaries and Wages Expense 726 5,200
Rent Expense 729 900
Interest Expense 729 50
(To close expense accounts)
9. Prepare a Yazici Advertising
Post-Closing October 31, 2020
Trial Balance Cash

Debit
₺15,200
Credit

Supplies 1,000
Equipment 5,000
Accumulated Depreciation ₺ 40
Notes Payable 5,000
Unearned Service Revenue 800
Interest Payable 50
ILLUSTRATION 4.12
₺21,950 ₺21,950

Classified Statement of Financial Position
• Presents a snapshot at a point in time
• To improve understanding, companies group similar
assets and similar liabilities together
Assets Liabilities and Equity

Current assets Equity
Long-term investments Non-current liabilities
Property, plant, and equipment Current liabilities
Intangible assets
ILLUSTRATION 4.20
Standard statement of financial position classifications

Cheng Ltd.
October 31, 2020
Assets
Current assets
Cash NT$ 6,600
Debt investments 2,000
Accounts receivable 7,000
Notes receivable 1,000
Inventory 3,000
Supplies 2,100
Prepaid insurance 400
Total current assets NT$22,100
Long-term investments
Stock investments 5,200
Investment in real estate 2,000 7,200
Property, plant, and equipment
Land 10,000
Equipment NT$24,000
Less: Accumulated depreciation– equipment 5,000 19,000 29,000
Intangible assets
Patents 3,100
Total assets NT$61,400

Classified statement of financial position
Cheng Ltd.
October 31, 2020
Liabilities and Owner’s Equity
Current liabilities
Notes payable NT$ 11,000
Accounts payable 2,100
Unearned service revenue 900
Salaries and wages payable 1,600
Interest payable 450
Total current liabilities NT$16,050
Long-term liabilities
Mortgage payable 10,000
Notes payable 1,300
Total long-term liabilities 11,300
Total liabilities 27,350
Owner’s equity
Owner’s capital 34,050
Total liabilities and owner’s equity NT$61,400

Classified statement of financial position
Intangible Assets
• Long-lived assets that do not have physical substance
ILLUSTRATION 4.22
Nokia
Statement of Financial Position (partial)
(in millions)
Intangible assets
Capitalized development costs € 244
Goodwill 6,257
Other intangible assets 3,913
€10,414

Property, Plant, and Equipment
• Long useful lives
• Currently used in operations
• Depreciation - allocating the cost of assets to a
number of years
• Accumulated depreciation - total amount of
depreciation expensed thus far in the asset’s life
• Sometimes called fixed assets or plant assets

Property, Plant, and Equipment
ILLUSTRATION 4.23
Laclede Group
(₩ in billions )
Property, plant, and equipment
Land ₩2,604
Buildings ₩9,487
Structures 1,568
Machinery 36,956
Vehicles 226
Other 10,600 58,837
Less: Accumulated depreciation 32,617
₩28,824

Long-Term Investments
• Investments in stocks and bonds of other companies
• Investments in non-current assets such as land or
buildings that are not currently being used in
operating activities
• Long-term notes receivable
ILLUSTRATION 4.24
Alphabet Inc.
(in thousands)
Long-term investments
Non-marketable equity investments $1,469

Current Assets
• Assets that a company expects to convert to cash or
use up within one year
• Operating cycle is the average time that it takes to
 purchase inventory,
 sell it on account, and
 collect cash from customers

Current Assets ILLUSTRATION 4.25
Tesco
(£ in millions)
Current assets
Inventories £2,430
Trade and other receivables 1,311
Derivative financial instruments 97
Current tax assets 6
Short-term investments 360
Cash and cash equivalents 1,788
Total current assets £5,992
Accounts usually listed in order liquidity.
Owner’s Equity
• Proprietorship - one capital account
• Partnership - capital account for each partner
• Corporation - Common Stock and Retained Earnings
ILLUSTRATION 4.26
Halie Capital Ltd.
(in thousands)
Equity
Share capital £ 685,934
Retained earnings 1,406,747
Total equity £2,092,681

Non-Current Liabilities
• Obligations a company expects to pay after one year.
ILLUSTRATION 4.27
Siemens
(in millions)
Non-current liabilities
Long-term debt € 14,260
Pension plans and similar commitments 4,361
Provisions 2,533
Deferred tax liabilities 726
Other non-current liabilities 2,752
€24,632
Current Liabilities
• Obligations company is to pay within coming year or
its operating cycle, whichever is longer
• Usually list notes payable first, followed by accounts
payable. Other items follow in order of magnitude
• Common examples are accounts payable, salaries and
wages payable, notes payable, interest payable,
income taxes payable, current maturities of long-term
obligations
• Liquidity - ability to pay obligations expected to be
due within the next year
Current Liabilities
ILLUSTRATION 4.28
Siemens
(in millions)
Current liabilities
Trade payables € 8,860
Current provisions 5,165
Other current financial liabilities 2,427
Income taxes payable 1,970
Current maturities for long-term debt 1,819
Other current liabilities 22,210
€42,451

Patents and copyrights are
a. Current assets
b. Intangible assets
c. Long-term investments
d. Property, plant, and equipment

Which of the following is not a non-current liability?
a. Bonds payable
b. Current maturities of long-term obligations
c. Long-term notes payable
d. Mortgages payable

DO IT! 4 Statement of Financial Position Classifications
Match each of the following to its proper statement of financial position classification, shown
below. If the item would not appear on a statement of financial position, use “NA.”
CL Salaries and wages payable LTI Stock investments (long-term)
NA Service revenue PPE Equipment
CL Interest payable PPE Accumulated depreciation
IA Goodwill NA Depreciation expense
CA Debt investments (short-term) OE Owner’s capital
NCL Mortgage payable (due in 3 years) CL Unearned service revenue
Current assets (CA) Current liabilities (CL)

Long-term investments (LTI) Non-current liabilities (NCL)
Property, plant, and equipment (PPE) Owner’s equity (OE)
Intangible assets (IA)

Copyright
Copyright © 2019 John Wiley & Sons, Inc.
All rights reserved. Reproduction or translation of this work beyond that permitted in
Section 117 of the 1976 United States Act without the express written permission of the
copyright owner is unlawful. Request for further information should be addressed to the
Permissions Department, John Wiley & Sons, Inc. The purchaser may make back-up copies
for his/her own use only and not for distribution or resale. The Publisher assumes no
responsibility for errors, omissions, or damages, caused by the use of these programs or
from the use of the information contained herein.
Copyright ©2019 John Wiley & Son, Inc. 53

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Completing the

Copyright ©2019 John Wiley & Son, Inc. 3

LO 1 Copyright ©2019 John Wiley & Son, Inc. 4

LO 1 Copyright ©2019 John Wiley & Son, Inc. 5

LO 1 Copyright ©2019 John Wiley & Son, Inc. 6

Add additional accounts as needed.

Check equality of adjusted trial balance columns.

Extend adjusted trial balance amounts to appropriate financial statement columns.

Compute net income or net loss.

LO 1 Copyright ©2019 John Wiley & Son, Inc. 12

LO 2 Copyright ©2019 John Wiley & Son, Inc. 16

All revenue accounts All asset accounts

All expense accounts All liability accounts

Owner's drawings account Owner's capital account

LO 2 Copyright ©2019 John Wiley & Son, Inc. 17

LO 2 Copyright ©2019 John Wiley & Son, Inc. 18

(Individual) Income (Individual)

LO 2 Copyright ©2019 John Wiley & Son, Inc. 19

GENERAL JOURNAL Page J3

LO 2 Copyright ©2019 John Wiley & Son, Inc. 20

GENERAL JOURNAL Page J3

LO 2 Copyright ©2019 John Wiley & Son, Inc. 21

Copyright ©2019 John

LO 2 Copyright ©2019 John Wiley & Son, Inc. 24

LO 2 Copyright ©2019 John Wiley & Son, Inc. 25

LO 2 Copyright ©2019 John Wiley & Son, Inc. 26

9. Prepare a post-closing trial

8. Journalize and post closing

6. Prepare an adjusted trial 5. Journalize and post

LO 3 Copyright ©2019 John Wiley & Son, Inc. 27

LO 3 Copyright ©2019 John Wiley & Son, Inc. 28

LO 3 ILLUSTRATION 2.29 Copyright ©2019 John Wiley & Son, Inc. 29

Date Titles Ref. Debit Credit

Cash 101 Owner's Capital 301

LO 3 ILLUSTRATION 2.19 Copyright ©2019 John Wiley & Son, Inc. 30

LO 3 Copyright ©2019 John Wiley & Son, Inc. 31

Date Titles Ref. Debit Credit

Supplies Supplies Expense

LO 3 Copyright ©2019 John Wiley & Son, Inc. 32

LO 3 Copyright ©2019 John Wiley & Son, Inc. 33

LO 3 Copyright ©2019 John Wiley & Son, Inc. 34

Trial Balance Cash

Accounts Receivable 200

LO 3 Copyright ©2019 John Wiley & Son, Inc. 36

Assets Liabilities and Equity

LO 4 Copyright ©2019 John Wiley & Son, Inc. 37

LO 4 ILLUSTRATION 4.21 Copyright ©2019 John Wiley & Son, Inc. 38

LO 4 ILLUSTRATION 4.21 Copyright ©2019 John Wiley & Son, Inc. 39

LO 4 Copyright ©2019 John Wiley & Son, Inc. 40

LO 4 Copyright ©2019 John Wiley & Son, Inc. 41

LO 4 Copyright ©2019 John Wiley & Son, Inc. 42

LO 4 Copyright ©2019 John Wiley & Son, Inc. 43

LO 4 Copyright ©2019 John Wiley & Son, Inc. 44

LO 4 Copyright ©2019 John Wiley & Son, Inc. 46

LO 4 Copyright ©2019 John Wiley & Son, Inc. 49

LO 4 Copyright ©2019 John Wiley & Son, Inc. 50

LO 4 Copyright ©2019 John Wiley & Son, Inc. 51

Current assets (CA) Current liabilities (CL)

LO 4 Copyright ©2019 John Wiley & Son, Inc. 52

Copyright ©2019 John Wiley & Son, Inc. 53