Develop an income statement.
Instructions for Discussion post #1:
In Week 1, you developed a personal balance sheet. Now, you will develop an income statement. Complete the following:
Develop 5–10 transactions that include receiving income and paying expenses, such as rent, insurance, salaries, water, electric, internet, etc.
Record these transactions as journal entries.
Post the journal entries to “T” accounts to obtain an ending balance.
Then, prepare an income statement in proper form and post to the discussion area and tell us what, if anything, surprised you. Also, indicate how you would like this to look ten years from now.
Discussion post #2:
In your reading this week, you learned about the accrual basis of accounting, including the end of period adjusting process. In your posting, address the following points:
Discuss the advantages of the accrual basis of accounting compared with the cash basis of accounting.
Consider your current employer and describe two adjusting entries that you believe they might need to make at the end of a given accounting period.
Explain how the financial statements might be misleading if adjusting entries are omitted.
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