| A | B |
|---|
| worksheet | used to plan adjustments and sort financial information |
| accounting period cycle | preparing a work sheet at the end of each fiscal period because financial statements are prepared at the end of each fiscal period |
| inventory | amount of goods on hand |
| merchandise inventory | amount of goods on hand for sale to customers |
| income summary | account used to adjust the merchandise inventory at the end of a fiscal period |
| prepaid insurance and insurance expense | two accounts used to adjust prepaid insurance |
| supplies and supplies expense | two accounts used to make adjustments to supplies |
| income summary and merchandise inventory | two accounts used to make adjustments to merchandise inventory |
| Income Summary Adj. Cr. Column | represents an increase in merchandise inventory |
| Income Summary Adj. Dr. Column | represents a decrease in merchandise inventory |
| Income Summary | only difference between a worksheet for merchandising and service |
| insurance expense | portion of insurance premium that has expired during a fiscal period |
| matching expenses with revenue | recording expenses in the accounting period in which the expenses contribute to earning revenue |
| Merchandise Inv. Trial Balance Dr. Column | beginning inventory of a fiscal period |
| Trial Balance | a proof of the equality of debits and credits in a general ledger |
| Adjusting entries | journal entries recorded to update general ledger accounts at the end of a fiscal period |
| Purchases | recorded in the purchases account and merchandise inventory is updated at the end of the fiscal period |
| Supplies Expense | represents the amount of supplies used during a fiscal period |
| Net Loss | Income Statement Debit column is larger than the Income Statement Credit column |
| Net Income | Income Statement Credit column is larger than the Income Statement Debit column |
| Net Income | extended to the Balance Sheet Credit Column |
| Net Loss | extended to the Balance Sheet Debit Column |
| Purchases | extended to the income statement debit column |
| Net loss | income statement credit column and balance sheet debit column |
| Beginning Mer. Inv. larger than ending | Dr. Income Summary Cr. Merchandise Inventory |
| Ending Mer. Inv larger than beginning | Dr. Merchandise Inventory Cr. Income Summary |
