Bookkeeping, step by step

Assets, liabilities, and equity, and how every transaction keeps them in balance.

• What bookkeeping is and why it balances
• How transactions affect the equation
• Prepayments, advances, and accruals in the equation
• Accounting equation mixed practice(Pro practice)

Account types, normal balances, and how a chart of accounts is organized.

• The five account types
• Normal balances
• Reading a chart of accounts
• Contra accounts(Pro practice)

Why every entry has equal debits and credits, including contra accounts.

• Debits and credits explained
• Double-entry bookkeeping
• Debits and credits for contra accounts and drawings
• Debit and credit speed drill(Pro practice)

Turning source documents into correct journal entries.

• Your first journal entries
• Recording expenses and payments
• Collections, advances, and owner withdrawals
• Working from source documents(Pro practice)

Multi-line entries, splits, correcting entries, and reversals.

• Compound journal entries(Pro practice)
• Split lines and allocation(Pro practice)
• Correcting entries(Pro practice)
• Reversals and duplicates(Pro practice)

Posting entries and reading account balances.

• T-accounts
• The general ledger
• Subledgers and control accounts
• Posting and balancing practice(Pro practice)

Building a trial balance and finding errors it can and cannot reveal.

• Preparing a trial balance(Pro practice)
• Errors a trial balance cannot find(Pro practice)
• Finding trial-balance differences(Pro practice)
• From unadjusted to adjusted trial balance(Pro practice)

Day-to-day cash bookkeeping, petty cash funds, and bank fees.

• Cash receipts(Pro practice)
• Cash payments and checks(Pro practice)
• Petty cash(Pro practice)
• Bank fees, interest, and returned checks(Pro practice)

Matching the bank statement to the books and recording only the right adjustments.

• Bank reconciliation basics
• Matching bank and book transactions
• Recording book adjustments
• Bank errors and difficult reconciliations(Pro practice)

Invoicing, collections, credit notes, discounts, and bad debts.

• Invoicing and accounts receivable(Pro practice)
• Credit notes, returns, and discounts(Pro practice)
• Bad debts and the allowance method(Pro practice)
• Partial payments and allocations(Pro practice)

Recording supplier bills, returns, discounts, and payments.

• Recording supplier bills(Pro practice)
• Paying suppliers(Pro practice)
• Purchase returns and discounts(Pro practice)
• Reconciling payables(Pro practice)

When revenue and expenses are recorded under accrual and cash bases.

• Accrual basis vs cash basis
• Revenue recognition at an introductory level
• Expense recognition and matching
• Period cutoff(Pro practice)

Prepayments, accruals, deferred revenue, and reversing entries.

• Why adjusting entries exist(Pro practice)
• Deferrals: prepaid expenses and unearned revenue(Pro practice)
• Accruals: unpaid expenses and unbilled revenue(Pro practice)
• Reversing entries(Pro practice)

Capitalizing assets, straight-line depreciation, and disposals.

• Capitalizing fixed assets(Pro practice)
• Straight-line depreciation(Pro practice)
• Partial-year depreciation(Pro practice)
• Disposing of fixed assets(Pro practice)

Perpetual inventory, FIFO, and gross profit, with methods stated.

• Perpetual inventory basics(Pro practice)
• FIFO costing(Pro practice)
• Returns and shrinkage(Pro practice)
• Net sales and gross profit(Pro practice)

Gross-to-net pay and payroll liabilities using fictional rates.

• Gross pay to net pay(Pro practice)
• Employer payroll costs(Pro practice)
• Paying payroll liabilities(Pro practice)
• Payroll at month-end(Pro practice)

Collecting, recording, and remitting tax using fictional rates.

• Sales tax basics(Pro practice)
• Remitting sales tax(Pro practice)
• Tax on purchases(Pro practice)
• VAT concepts(Pro practice)

Income statement, balance sheet, owner's equity, and a basic cash-flow view.

• The income statement
• The balance sheet
• Statement of owner's equity
• A basic cash-flow view(Pro practice)

The close checklist, closing entries, and the post-closing trial balance.

• The month-end close checklist(Pro practice)
• Closing entries(Pro practice)
• The post-closing trial balance(Pro practice)
• Controls and correcting closed periods(Pro practice)

Mixed real-world tasks, self-assessment, and interview preparation.

• Mixed practice: service business(Pro practice)
• Mixed practice: retail and inventory(Pro practice)
• Preparing for a bookkeeping skills test(Pro practice)
• Bookkeeper interview preparation(Pro practice)