What is an Accounting Worksheet?

Accounting Worksheet

Share This...

Accounting Worksheet

An accounting worksheet is an informal, multi-column document used by accountants and bookkeepers as a working tool to facilitate the preparation of financial statements and the end-of-period adjusting process. It is not a required part of the formal financial statements, nor is it presented to external users. Instead, it serves as an internal document that organizes and summarizes financial information, helping to ensure accuracy and completeness in the accounting records.

An accounting worksheet typically consists of the following columns:

  • Account Names: Lists all the accounts from the general ledger, such as assets, liabilities, equity, revenues, and expenses.
  • Unadjusted Trial Balance: Shows the account balances before any adjusting entries have been made.
  • Adjusting Entries: Records any required adjusting entries, such as accrued expenses, deferred revenue, and depreciation adjustments.
  • Adjusted Trial Balance: Reflects the account balances after adjusting entries have been posted. The adjusted trial balance is used to prepare the financial statements.
  • Income Statement: Includes revenue and expense accounts, which are used to calculate net income or net loss.
  • Balance Sheet: Includes asset, liability, and equity accounts, which are used to determine the financial position of the business.

The accounting worksheet helps accountants and bookkeepers in several ways:

  • Organizes financial data: The worksheet systematically organizes financial data from the general ledger, making it easier to identify errors or discrepancies and ensure the accuracy of the accounting records.
  • Facilitates adjusting entries: The worksheet provides a clear and structured format for recording adjusting entries, helping to ensure that necessary adjustments are made to the financial records.
  • Simplifies the preparation of financial statements: By summarizing financial information in a single document, the accounting worksheet simplifies the process of preparing financial statements, such as the income statement and balance sheet.
  • Assists in the closing process: The worksheet helps accountants and bookkeepers close the books at the end of the accounting period by revealing temporary accounts that need to be closed and permanent accounts that carry over to the next period.

While accounting worksheets can be prepared manually, many accounting software programs and spreadsheet applications offer templates or tools that automate the process, reducing the time and effort required to create and maintain the worksheet.

Example of an Accounting Worksheet

Here’s a simplified example of an accounting worksheet for a fictional company, “Bella’s Bakery,” at the end of the accounting period:

Account NamesUnadjusted TBAdjusting EntriesAdjusted TBIncome StatementBalance Sheet
Accounts Receivable5,0005,0005,000
Prepaid Rent3,000-1,0002,0002,000
Accum. Depreciation-4,000-1,000-5,000-5,000
Accounts Payable6,0006,0006,000
Wages Payable2,0002,0002,000
Owner’s Equity30,00030,00030,000
Rent Expense2,0001,0003,0003,000
Wages Expense12,0002,00014,00014,000
Depreciation Exp.1,0001,0001,000

In this example, Bella’s Bakery has an unadjusted trial balance with the account balances before any adjusting entries. The adjusting entries column reflects necessary adjustments, such as recognizing rent and wage expenses and recording depreciation expense. The adjusted trial balance column shows the account balances after these adjustments.

The income statement and balance sheet columns summarize the revenue and expense accounts and the asset, liability, and equity accounts, respectively. In this example, Bella’s Bakery has a net income of $22,000 (Revenue of $40,000 minus Total Expenses of $18,000) and a total equity of $35,000 (Total Assets of $47,000 minus Total Liabilities of $12,000).

This accounting worksheet helps Bella’s Bakery organize its financial information, identify necessary adjustments, and prepare its financial statements more easily and accurately.

Other Posts You'll Like...

Want to Pass as Fast as Possible?

(and avoid failing sections?)

Watch one of our free "Study Hacks" trainings for a free walkthrough of the SuperfastCPA study methods that have helped so many candidates pass their sections faster and avoid failing scores...