What is the difference between a heading and a body?
The heading of a worksheet consists of three parts: (a) the business name, (b) the title “worksheet”, and (c) the accounting period for which the worksheet is prepared. A worksheet's body contains 10 money columns (or 5 pairs), each pair consisting of a debit column and credit column, arranged in this order: assets, liabilities, income statement items (with some exceptions for certain businesses), stockholders' equity, expenses, dividends. The worksheet is headed by the account names from the Accounting Equation - assets = liabilities + owners' equity.
What is the relationship between a worksheet and an adjusted Trial Balance?
The items in the heading of a worksheet are identical to those of an adjusted Trial Balance. The body of a worksheet contains information that will be shown on the company's Financial Statements, which is not necessarily the same as that shown on the company's adjusted Trial Balance.
What is a Double-entry System?
As defined in this tutorial, a Double-entry System is a method of accounting used to ensure that each debit entry appears with an equal and corresponding credit entry. The term “double-entry” refers to the fact that every entry requires two accounts for its recording, one account called the debit account, into which is posted the amount of the debit entry; and one account called the credit account, into which is posted the amount of the corresponding credit entry.
What are debits and credits?
The words “debit” and “credit” are accounting terms that indicate whether an amount is to be entered (posted) as a positive (plus) or negative (minus) value, either on the left-hand side of an account (one who “debits”) or on the right-hand side of an account (one who “credits”). When recording transactions in accounting records, debit entries are made for expenses and losses; credit entries are made for income and gains.
What is an account?
An account is a record of money (or other items of value) in which the total debits must equal the total credits at all times. The term "account" can refer to either an individual or a group of accounts, depending on the context in which the term is used.