Bookkeeper
Accounting Equation:
Assets = Liabilities + Equity
Rules of Double-
Entry Bookkeeping;
Total Debits must always
equal
De
bits are always on the left side of a trial balance
Credits are alwa
ys on the right
How Debits and Credits show up in the Chart of Accounts
Account Type
Reported On
Assets
Balance Sheet
Liability
Balance Sheet
Equity
Balance Sheet
Income
Income Statement
Expense
Income Statement
Reporting Reminders:
The Balance Sheet
is a snapshot of the business
The Income Statement
reports the profit or loss of a business over a period of time
Net profit or loss is reported in the Equity section of the Balance Sheet
Assets
are what the business owns of value
I.E.
Bank accounts, cars, computers, office equipment
Liabilities
are the amounts the business owes to others
I.E.
GST/HST, Deduc
Equity
is the value retained in the business
I.E.
Retained Earn
Income
is what is earned as a result of the operation of the busi
I.E.
Yo
Expenses
are what is paid to support the op
I.E.
COGS
insurance, office supplies, accounting and legal,
Bookkeeper
’s Cheat Sheet
At a Glance
Assets = Liabilities + Equity
Entry Bookkeeping;
equal
Total Credits
bits are always on the left side of a trial balance
ys on the right
of a trial balance
How Debits and Credits show up in the Chart of Accounts
Reported On
Normal Balance
Increase
Balance Sheet
Debit
Debit
Balance Sheet
Credit
Credit
Balance Sheet
Credit
Credit
Income Statement
Credit
Credit
Income Statement
Debit
Debit
is a snapshot of the business
’s financial on a specific
point in time
reports the profit or loss of a business over a period of time
Net profit or loss is reported in the Equity section of the Balance Sheet
are what the business owns of value
– Cash,
property and other valuables
Bank accounts, cars, computers, office equipment
are the amounts the business owes to others
GST/HST, Deduc
tions at Sources, loans
, accounts payable
is the value retained in the business
Retained Earn
ings, owners Equity
is what is earned as a result of the operation of the busi
ness
Yo
urs sales, grant and subventions
are what is paid to support the op
eration of the business.
COGS
(Cost Of Goods Sold), wages, a
dvertising, telephone, r
insurance, office supplies, accounting and legal,
and much more...
How Debits and Credits show up in the Chart of Accounts
Increase
Decrease
Debit
Credit
Credit
Debit
Credit
Debit
Credit
Debit
Debit
Credit
point in time
reports the profit or loss of a business over a period of time
property and other valuables
Bank accounts, cars, computers, office equipment
, accounts receivable
, accounts payable
dvertising, telephone, r
ent,
and much more...
