Earned revenue is not one of them.

Balance sheet reports the assets, liabilities and the owner’s equity in a specific date. In other words, balance sheet provides information about the financial position of the company. In the trial balance you can easily find out asset, liability and owner’s equity accounts which will form the balance sheet.

The first step of the accounting process consists of identifying the financial transactions related with the organisation. The sale of a table by a furniture shop, the payment of wages or the provisions for services are the examples of financial transactions.

The correct answer is C. Assets are recorded at their cost when acquired by the company and this value stays same over the time according to the historical cost principle.

Deferred expenses are the ones that are firstly paid and reported as an asset but will not be recorded as an expense until a future accounting period.

Corporation

• Identifying includes selecting financial transactions.
• Recording includes recording, classifying, and summarizing.
• Communicating includes preparing financial reports.
• Bookkeeping is an activity or occupation of keeping records of the financial transactions

A chart of accounts is a listing of the accounts and the account numbers which identify their location
in the ledger.

it should be ledger

At the end of the accounting period, an adjusting entry is completed, and it records revenues to the period in which they are earned and expenses to the period in which they occur. Adjusting entries also update the asset and liability accounts. Adjustments are necessary to properly measureseveral items such as:
1. Net income (loss) on the income statement
2. Assets and liabilities on the balance sheet

According to Dr./Cr. Rules for Expenses, expenses increase on left side by debiting while decrease on right side by crediting and normally show debit balance.

For the preparation of financial statements, the starting point is the adjusted trial balance. As you can remember from the previous chapters, adjusted trial balance is one form of trial balance that holds in-term transactions’ totals and balances as well as the end of the period transactions’ totals and balances for final checking of the accounts and preparation of financial statements. After the preparation of adjusted trial balance and financial statements, closing entries will be recorded in order to get accounts ready for the next year. We will focus on closing process further in this chapter. Now, let’s have a look at the financial statements. Financial statements are prepared in order;

• Income statement
• Statement of owner’s equity
• Balance sheet

T-accounts have a title and include two sides: Debit (left) and credit (right). Debit represents the left side of an account. Credit represents the right side of an account.

The correct answer is C. A trial balance summarizes the accounts by listing all the accounts with their balances—assets first, followed by liabilities, and then owner’s equity.

There are three main steps which occur repeatedly in the recording process: Analyzing, journalizing and posting. The correct sequence of these steps is in option D.

Matching Principle (Expense recognition principle) means that you will record the expenses at the same time with the revenues related with these expenses are recorded. The correct answer is B.

Businesses will have a lot of financial transactions with customers, suppliers, creditors, employees, tax authorities, governmental agencies, and others. Financial transactions are economic events that affect a company’s financial position. Therefore, you need to understand both the recording of transactions and combining of those transaction records to prepare financial statements

The two basic categories of adjustments can be divided into four different types as follows:
1. Deferred (Prepaid) Expenses
2. Deferred (Unearned) Revenues
3. Accrued Expenses
4. Accrued Revenues