Answer to Question #247182 in Accounting for birhan

Question

HOW TO PREPAIR WORKSHEETS

Answer 1

Worksheets are documents that are used in finance to analyze and review account balances and aims at ensuring that entries are done correctly as well as helping in case of audits in tracking particular transaction or information. Worksheets are not mandatory but they allow companies to see account balances and how adjusting entries would affect their ledgers before they prepare their financial statements.

In preparing worksheets, an accountant has to identify the name of business and the date of the transaction, and insert their corresponding columns either Debit (Dr) or Credit (Cr) entries using the basic accounting principles on double entry.

The finance officer will then prepare an in-adjusted trial balance which will help in tracking errors and correcting them. Using the adjustment column, the accountant will then rectify and then prepare an adjusted trial balance. Once the adjusted trial balance is prepared, then the accountant will proceed to prepare draft financial statements such as balance sheet, retained earning statement, income statement which he will then use to prepare final statements.