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3.5: Preparing Financial Statements

  • Page ID
    20083
    • Henry Dauderis and David Annand
    • Athabasca University via Lyryx Learning
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    learning objective

    LO4 – Use an adjusted trial balance to prepare financial statements.

    In the last section, we saw that the adjusted trial balance is prepared after journalizing and posting the adjusting entries. This section shows how financial statements are prepared using the adjusted trial balance.

    imgn.png

    Figure \(\PageIndex{1}\): BDCC's January 31, 2015 Adjusted Trial Balance and Links Among Financial Statements

    The income statement is prepared first, followed by the statement of changes in equity as shown below.


    imgb-2.png

    Figure \(\PageIndex{2}\)

    The balance sheet can be prepared once the statement of changes in equity is complete.


    imgc-2.png

    Figure \(\PageIndex{3}\)

    The balance sheet can be prepared once the statement of changes in equity is complete.


    3.5: Preparing Financial Statements is shared under a CC BY-NC-SA license and was authored, remixed, and/or curated by Henry Dauderis and David Annand (Lyryx Learning) .

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