Produce a checked adjusted close
See this course’s project requirements
A fictional month-end adjustment packet with accruals, prepayments, depreciation, corrected trial balance and reconciled income statement.
Keep your working files in your own notebook or software. Save a private description, checklist, and work link in My Proof.
What to include
- An earned-revenue adjustment journal and posted balances.
- An unpaid-wage accrual and later-settlement distinction.
- A prepaid-rent release schedule and asset/expense posting.
- A depreciation assumption schedule and gross/contra/net bridge.
- A posted adjustment journal and complete adjusted trial balance.
- An adjusted income statement, balance-sheet bridge and changed-earned-revenue check.
Review and revise
Use these criteria to check your work and choose what to improve.
- Cutoff: each adjustment has period evidence.
- Journal: debit/credit accounts and amounts are correct.
- Posting: adjusted balances and totals reconcile.
- Statements: profit and net assets obey the accounting equation.
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The idea in everyday life
Original fictional practice. All money is USD. No account, payment, personal record or outside participation is required. Original fictional month-end unadjusted trial balance: debit cash 5,000; accounts receivable 1,000; prepaid rent 1,200; equipment 2,400; wages expense 600. Credit accounts payable 800; unearned revenue 1,200; owner capital 6,200; service revenue 2,000. Each side totals 10,200. Month-end evidence:400 of advance service was earned;300 service earned but unbilled;250 wages incurred/unpaid; prepaid rent covers three equal months including this one; equipment cost 2,400, zero residual,24-month straight-line life, full month in use. No other transactions, tax, drawings or opening accumulated depreciation.
Statements connect period performance with ending assets, obligations and capital.
Produce a checked adjusted close — complete worked case
Statements connect period performance with ending assets, obligations and capital.
Original fictional month-end unadjusted trial balance: debit cash 5,000; accounts receivable 1,000; prepaid rent 1,200; equipment 2,400; wages expense 600. Credit accounts payable 800; unearned revenue 1,200; owner capital 6,200; service revenue 2,000. Each side totals 10,200. Month-end evidence:400 of advance service was earned;300 service earned but unbilled;250 wages incurred/unpaid; prepaid rent covers three equal months including this one; equipment cost 2,400, zero residual,24-month straight-line life, full month in use. No other transactions, tax, drawings or opening accumulated depreciation.
Unadjusted original trial balance
Paste at A1.
| AAccount | BDebit | CCredit |
|---|---|---|
| Cash | 5000 | 0 |
| Receivable | 1000 | 0 |
| Prepaid rent | 1200 | 0 |
| Equipment | 2400 | 0 |
| Wages expense | 600 | 0 |
| Payable | 0 | 800 |
| Unearned revenue | 0 | 1200 |
| Capital | 0 | 6200 |
| Service revenue | 0 | 2000 |
Copy as plain text
1. 6.1 Produce
Map revenue/expense accounts to the income statement, then compute 1,350.
You should see: Expense total 1,350 and revenue 2,700.
2. 6.2 Produce
Map assets and accumulated depreciation to net 9,400.
You should see: Contra allocation reduces equipment net value.
3. 6.3 Produce
List obligations 1,850 and capital-plus-profit 7,550; reconcile the accounting equation.
You should see: Assets 9,400=liabilities 1,850+equity 7,550.
4. 6.4 Produce
Change earned advance from 400 to 600 and update revenue/profit/equity/unearned; verify assets remain 9,400.
You should see: Profit 1,550, liabilities 1,650, equity 7,750; equation still balances.
What to finish
An adjusted income statement, balance-sheet bridge and changed-earned-revenue check.
Watch for this
Treating liabilities as expenses or calling profit equal to cash received.
How can I tell I understand it?
Verify that your completed adjusted income statement, balance-sheet bridge and changed-earned-revenue check meets the three lesson-specific checks and retains the supporting original records.
Quick knowledge check
Answer all 3 questions. Get at least 2 right and the lesson completes automatically.
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Pass the check. We’ll save the progress.
Answer all 3 questions above and get at least 2 right. You can review the explanations and try again.
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Sources and further reading
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Source & access notes · checked 2026-10-01
Read earned/incurred versus received/paid and period boundary; no current tax-basis claim inferred.
Access: Public primary page body opened and relevant sections read through the web reader on 2026-10-01; no account required for reading.
Reuse: Original Life Starter cases, datasets and questions; no source exercise or worked dataset reproduced. Links support further reading.
Source & access notes · checked 2026-10-01
Read posting before adjusted trial balance and computational check limits; balanced totals alone do not prove correct account/date choices.
Access: Public primary page body opened and relevant sections read through the web reader on 2026-10-01; no account required for reading.
Reuse: Original Life Starter cases, datasets and questions; no source exercise or worked dataset reproduced. Links support further reading.
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