yo yo yo what up fam I love doing these welcome back accounting for beginners my
classic series number 31 accounting for beginners number 31 we hear boy if is
your first one hit subscribe and looking for the card up here because it's the
best accounting playlist on youtubes on the internet in the world let's go this
is highly requested so 31 it's going to be the adjusting adjusting entries in
the book that I have here in the book this is the book I'm rocking with I got
like $10 off Amazon I don't know five different adjusting entries and we're
just going to go through them the next this video in the next four I guess
we're going to do the adjusted entries yo here they are I've been listening
here they are just something I noticed out of the five adjusting entries and
why are they adjusting you do it at the end of the period you need to make your
justed entries and why are they adjusting like why do you have to wait
tell until the end and my opinion here because there's no cash now it could be
wrong when I make statements and anyways I'm just I'm just a dude man I'm just a
I'm just a dude okay yeah yes I do have a CPA license yes I do do this for a
living but I can make errors sure so there's no cash so that's why that's why
like if there was cash in the account then you would just be done like you
would need to adjust anything you'll kind of see so we're going to do
depreciation it's one of the five now I've already done depreciation but that
was when I started is when I was first ranking my office here and I was like so
nervous I thought you know how everyone's gonna hear me and I wasn't
and I'm like I'm renting office here and I'm wasting my time making YouTube
videos no one's watching what am i doing my life
so anyways let's give me the first on our Justin entries depreciation at the
end of the period if you're new here you're going to notice this it's a DC a
blurs kind of my mapping system it's debit/credit assets are expense
liability equity revenue I just always put that on my paper you
put it on your paper - don't be lazy man don't be lazy
seriously serfs don't be lazy so let's set it up let's let's set it up here
during the year I'm gonna use the book example during the year you bought an
asset you bought office equipment for $1,800 you might have done that a couple
years ago but that's the only thing on the books that's on the books this is
your balance sheet balance sheet is assets equal liabilities plus equity the
only thing on your balance sheet is you have an office equipment for $1,800
assets equal why you don't have any liabilities and your equity is $1,800
equity of the office equipment you've already you already use cash when you
bought this you have debit debit office equipment credit cash and so it's
journal entry to get this on the books it was money coming out and you put it
on as an asset so what is depreciation anyways let's say office equipment let's
say this is the printers the $1,800 printer that's gonna last for a long
time you have it on as an asset you spent you spent money you spent money
over here and now you have an asset for that for the office equipment for the
printer now let's sit because that's going to last for years so you're going
to expense it every year let's say you about a paper paper for the printer now
you're going to run through that in a couple months so yes you have cash
coming out for that but you're just going to expense it right now because
you're going to use it in less than a year or this part of the period when
you're buying an asset or I guess buying something and use it as an expense
that's always that's going to be your debit it's either going to be the asset
it's going to be the office equipment the printer or the paper so let's go
ahead and your credit it's going to be money leaving it's going to be your
credit so years a year has gone by and now you're like well
you know we have less time on this printer and we need to do our expense
for the year and that is a depreciation expense so what would what would the
journal entry be it's always about a journal entry what would the journal
entry what's the journal entry going to be hopefully went over that so you would
think well now we need we need to expense the journal inch we need to
expense this printer because it's been it's been on the books for a year
depreciation expense also you might just hear you may just have heard just in
life your depreciation expense depreciation expense depreciation you
don't really know anything or you know some I don't know so depreciation would
run over this you're like I've heard depreciation expense I know DCA blur so
probably it's going to be it's probably going to be right there right the
journal entry here depreciation expense $50 because we figured out we figured
out for everything that we're going to appreciate this office equipment $50 for
the year and now we're going to journalize or the period so we know
we're taking oh we're taking a really good guess because we're not our
professionals we haven't done this a million times yet so we don't really
know we're just going to take a guess and we're going to say
damn it is going to be $50 depreciation expense all right great now we need to
credit now we need to credit and if we know we know it's got to be 50 bucks
because they always equal so look we have no idea about much we've heard
depreciation expense and we know DCA blur so look look at all the stuff we're
getting right already step by step by step practice practice practice
so we're going to put $50 over here on the card in now here's where it gets a
little tricky here's where it gets a little tricky and you just got to know
what is what is going to be the credit it's a thing called accumulated
depreciation and it's called a contra acet meaning it is it's an asset but
it's an it's a negative asset you just got to know I think for now mmm when you
when you have depreciation expense the credit for it is an accumulated
depreciation okay so that is that's the journal entry for a depreciation is
debit debit $50 depreciation expense credit accumulated depreciation so you
know look there's no no money no cash involved in this because you already
bought the asset before so now we're just depreciating the asset so this is
so this is your expense now do you see like if you for the year because like
when you bought paper or supply you expense it right away but now you're now
you get an expense you still want you still want to show
here that you bought the office equipment for $1,800 on the balance
sheet see it's a contra asset meaning it is a credit see so it's over here
accumulate depreciation is a credit and as you can see it's it's Oda if it's if
it's an asset accumulate depreciation is an asset because it goes along with the
fixed assets it's negative be negative over here and that's in its normal
balance negative on the credit side sideswipes contra so it goes it goes
here as a negative and on the balance sheet you would have accumulated
accumulated depreciation for $50 and that's what on the balance sheet so then
your office equipment is worth 1717 50 now thank you for watching thank you
very much if you enjoyed it get a like and I
wonder this new new method of I'm just trying to put out more content and let
you decide if it's good I know it's not perfect and I'm sorry found trying to
get better every time until next time stay blessed
love y'all booze