Video instructions and help with filling out and completing Which Form 2220 Accounting

Instructions and Help about Which Form 2220 Accounting

Hi in this video I am going to explain how to prepare trial balance so before that we need to have some basic knowledge about accounts some accounts is the art of recording all the transaction in the books of accounts is called accounts okay so in of course the first thing is journal so journal is a book where we used to record all the transaction in a systematic manner in a proper way we need to record all the transaction for that purpose we need to have journal ok journey is only for recording all the transaction and after recording all the transaction into the journal the second step is we need to group the similar kind of transaction for that purpose we need to have ledger after preparing the ledger the third step will be trial balance trial balance is not an account it's only a statement which shows debit balances and critic balances of all accounts in the ledger ok this will be like this just let's store all the items which you have prepared in the ledger and with this information they ask you to prepare trial balance so in order to prepare trial balance you need to understand two things first one is debit and credit so you need to have thorough knowledge about debit and credit so only thing you are going to do that just write each and every item in particular column and enter the amount either debit side or credit side so in order to identify whether the particular item is belong to debit or credit you need to have thorough knowledge of golden rules you know the three golden rules no so you need to have thorough knowledge about realloc and nominal account and personal account first thing you need to identify whether the particular item is belong to real account or nominal account or personal account then you can easily identify whether the pipe particular eye yes debit side or credit side so first you need to identify the item belong to real account or nominal account or personal account based on that with the help of this knowledge you can able to enter this amount either debit or credit according to Golden Rule let me explain the golden rule first then we can easily prepare the trial balance ineffective manner these are the three account that is golden rules first one real accounts real controllers debit what comes in credit what goes out the best example for real account is cash when you purchase any item cash goes out the particular item comes in when you sell something what goes out boots goes out and cash comes in so for real account cash will be the best example apart from cash all assets whether it is a current asset of fixer asset or assets or belong to real account cash and all assets are belong to real accountant and second one is personal account personal happen means any person whether it is a natural person or artificial person is a personal accountant so personable means any person the first thing is business is separate entity owner is separate entity so while you enter all the transaction you need to consider you need to view all the transaction from business point of view okay so in that way we can able to identify whether the particular item is debit side or the right side the rule is a personal control is debit the receiver credit the giver for example X invested is amount into the into his own business so what is the journal entry cash account 8.2 capital account that is X capital account so X is owner he is a real owner of the company he contributed his own amount in his own business but that Aman that capital should be recorded in credit side why because he is a given he or she will be the giver he contribute his amount into his own business no so capital should be recorded in credit side in the same way the ex the owner withdraws some amount from business it's called drawings so join means the appropriate ur withdraw some amount in the form of cash or in the form of goods withdraw amount of goods from the business so that transaction is called as drawings so the drawing should be recorded in debit side Y because X withdraw amount from the business so he or she will be the receiver so join should be entered in debit side capital should be entered in credit side y because capitalism which is contributed by propraetor he is a given circuit each drawing is a a mode which is drawn from the business so he or she should be recorded in debit side but one is nominal upon so nominal account just like a profit and loss of points where we used to record all the expenses and losses and incomes and gains so normally happen through less debit all expenses and losses credit all incomes and gains you need to identify the particular item is expense or income if it is expense means just debit the item if it is the income is just predict the item that's all so in this way you can able to prepare trial balance the first thing you need to identify the particular item the particular transaction is belong to real account or personal account or nominal account then you can enter either David said or thought it said according to this rule if it is expungements debit if it is an income means creditor if the person is the benefit means debited to the person giving some amount some goods to the company means a creditor if the particle cash or asset comes in minced a better sales goes out now so just predicted so based on that a big and product rule we can able to record the amount