About This Chapter
Accounting Fundamentals - Chapter Summary
The lessons in this chapter will help you get an idea of the basic operations of accounting, starting with steps of the accounting cycle, the accounting equation and the Generally Accepted Accounting Principles (GAAP). You will learn about source documents, closing entries and post-closing trial balance.
Other lessons explain the fundamentals of preparing financial statements and auditing those statements. You'll also get a look at commonly used accounting software. By the time you've finished watching these lessons, you should have the information to:
- Apply the accounting equation in business transactions
- Analyze accounting documents
- Explain how accrual and cash-based accounting differ
- Interpret financial reports
- Discuss ethical accounting practices
- Recognize the steps in the closing process
You'll enjoy learning about the fundamentals of accounting with our brief, engaging video lessons. These lessons, led by experts in the field, include written transcripts with key terms and concepts highlighted. At the end of the lessons are quizzes that allow you to check your knowledge, and embedded video tags let you easily return to the lesson to review areas where you need help.
1. Accounting Cycle: Definition, Steps & Process
Accounting isn't just about working with numbers. It is about following guidelines to get the job done. In this lesson, you will learn what the accounting cycle is and the steps to complete it.
2. The Accounting Equation: Definition & Components
There are a few basic building blocks that form the foundation of accounting. One of those is the accounting equation. In this lesson, you will learn what makes up the accounting equation, its purpose, and how it works.
3. Using the Accounting Equation: Analyzing Business Transactions
Transaction analysis can be a tricky task. In this lesson, you will learn what transaction analysis is, how to analyze a transaction, and how it is related to the accounting equation.
4. What Is GAAP? - The Generally Accepted Accounting Principles
Rules and regulations are a part of life for everyone, including those in the accounting industry. In this lesson, you will learn about GAAP standards, what they mean to accounting, and who establishes them.
5. The Differences Between Accrual & Cash-Basis Accounting
There are two accounting methods that companies can choose from when deciding how they want their books done. They are cash basis and accrual basis. In this lesson, you will learn the differences between the two.
6. Internal Controls in Accounting: Definition, Types & Examples
Rules and regulations are a part of everything we do. In this lesson, you will learn about internal controls in accounting. You will learn what they are, why they are important and see examples.
7. Source Documents in Accounting: Definition and Purpose
Do you know what role source documents play in accounting? If not, don't worry; by the end of this lesson, you will. You will also learn the definition of source documents and see some common examples of source documents.
8. Closing Entries: Process, Major Steps, Purpose & Objectives
The accounting cycle is a multi-step process. In this lesson, you will learn about part of that process: making closing entries. You will learn what closing entries are, what accounts are affected, and how they are made.
9. Computerized Accounting Software: Advantages & Disadvantages
With business as complex as it is today, adopting computerized accounting software seems like the right choice. Even the most sophisticated computer programs have advantages and disadvantages. We will explore these in this lesson.
10. Post-Closing Trial Balance: Preparation & Purpose
The last step in the accounting process is to create the post-closing trial balance. In this lesson, you will learn what the post-closing trial balance is, why it's important, and what accounts appear on it.
11. What Are Financial Statements? - Definition, Purpose & Importance
Financial statements are big players in the world of accounting. In this lesson, you will be introduced to each of the financial statements. You will also learn what their role is in the accounting industry, who they are important to and why they are important.
12. Preparing Financial Statements
Financial statements are the most sought after reports in the financial industry. In this lesson, you will learn how to prepare them using information found on the adjusted trial balance.
13. External Audits of Financial Statements
Financial statements are one of the most heavily relied upon group of reports in the business world, and they must be accurate and reliable. In this lesson, you'll learn about financial statement audits, who performs them, and why they are important.
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