Accounting for Beginners #76 / Getting Paid with Service Revenue / Income Statement / Widget INC #4

yo yo yo yo yo that’s 1/3 yos welcome
back I am CPA strength I am the strongest licensed CPA in the state of
Florida maybe going for the Southeast Regional I don’t know cuz your boy is
getting jerked okay you know it’s what’s up what do you do CPA strength I
motivate educate and inspire and I teach the world accounting the world over by
basic bucks basic basic blocks mainly by my math main system DC a blur debits
Credit acid drugs offense liability equity revenue I’m fired up today’s
gonna be a good one I think every video I’ll try to get better and this is the
best video I’ve ever made coming up right now I think it’s like 150th video
let’s go this happens to be the best place in the world over here if you just
hit this card and all your dreams will come true I’m a I guarantee that a
personal promise all your dreams will come true yeah yeah what is this this is
this is my classic series but this is a sub classic series of the main classic
series this is number 76 this is service revenue more importantly than being
accounting for beginners number 76 this is a road to 100 and we started on 73 73
74 75 76 in our own little business would you think and we’re selling
widgets we’re selling widgets and that’s what
we’re doing for our business and we’re running through road 173 through 100 is
just our business and if you would like to if you would if you like this if you
like the series please give it a like it really helps really really really helps
my videos out now if you have any ideas for videos please leave in the comment
down below I mean like if you want you if you want us to not have any money I
don’t know why you would want us to not have any money to have an office
dispenses but if you want to make us have like a really high service month or
something sort of swimming in the money so we can so we can freakin do stuff
anyways let’s get into this one I’m pumped up a bit listen to music Oh more
and I think I found one thing up on my schedule
I don’t know whoa 76 service revenue so we get some service revenue so what’s
going on here widget incorporate makes two thousand dollars from widget
repairs all right widget widget incorporated and that’s us that’s where
our widget incorporated had and we are shareholders I’m Tom on the books of
shoulders but you guys are on our show we’re gonna do a journal entry we’re
going to do a journal entry and then you know if you’ve been watching the I
started from 73 if you know we’re going to adjourn on sugar going to chart of
accounts we’re going to general ledger we’re gonna do income statement and
balance sheet let’s go to a journal entry for this is there cash is there
cash yeah we’re actually getting cash in this so we love this this should be our
favorite journal entry so we should know this one inside now because this should
be our journal this is my favorite journal entry debit cash a credit
service revenue that is my favorite journal entry so I don’t know like tell
me your favorite journal entry if this is not your favorite journal entry is
this fun or what you know people say accountants don’t have any imagination I
had to imagine making a hundred a hundred video series and I’m going to a
thousand so you’ve got to have imagination I’m doing this business here
I’m having imagination anyways what’s up with the journal and you get we’re
getting cash so if we’re getting cat or we’re getting we’re getting cash and
we’re gonna put it into our checking account so mmm I mean I guess in real
life you would look in your bank statement or your bank would have two
thousand dollars coming into it so you would know that it’s revenue so
sometimes you wanna know you know is this revenue is this an expense or just
trying to think logically and do the best you can and everything will be fine
and practice practice practice we move on that I gotta move on out of this
board what the floor something’s something right see if I’m
feeling good or everything so I’m always tries to deflect me out but it ain’t
gonna happen ain’t gonna happen let go come on please so yes we’re getting money we’re getting
cash and $2,000 we’re getting $2,000 so that would so cash checking account
whatever is an ass and we’re getting it so it’s coming into
the business so it’s going up so let’s go over to our GC and lurch our where’s
the assets going up assets going up debit so there’s our debit I can account
two thousand dollars which is an asset what’s our credit
what’s our credit well why did we get the two thousand dollars because we we
serve it we did weighted repairs who serviced widgets and that’s our main
thing we service them we might sell them later I don’t know but we just service
them now we don’t have the all the equipment and all the inventory and
whatnot we got we got money for doing stuff for an ordinary course of business
that’s a revenue a revenue accounts going up so that’s gonna be our credit
it’s either a debit or credit so there’s our there’s our credit widget service mm
revenue so our journal entry is four which is incorporated makes $2,000 for
widget repair our journal entry is debit $2,000 checking account which happens to
be an asset credit widget service $2,000 which happens to be a revenue all right
Becky and Becky and now we go to our chart of accounts what did we what did
we add in our journal and what do we have in our journal journal entry we’re
checking account we already had that in our chart of accounts and we also had
revenue widget services which we did not have in our chart of accounts so we
added so we just added it in we added in a widget service under revenue is our
first revenue so here’s our chart of accounts currently we have a checking
account we have a truck which is a fixed asset we have liabilities we have a loan
from shareholder that’s only liability our only revenues widget service are
only expenses rent but as you can see every time we do a journal entry and we
do not have an account for that journal entry on our chart of accounts we just
simply add it it’s just it’s easy like that we just add it inside every count
in our chart of accounts is the activity that happened so let’s start with our
widget service with the activity because there was only one transaction on for 30
15 oh that’s when we did our journal entry this time for 30 15 is our fourth
one that’s April so it all happened was it increased by $2,000 or just service
on fourth fifteen our general ledger for weighted
service now the fun one I think of course is our checking account and I’ve
tried to maybe it’ll come more if someone hasn’t seen it before or you’re
watching the series for the first time I just wanted to be very very evident that
most mostly you know keeping the books for a business or doing this I guess
this is keeping the books keeping up on you know journal entries chart of
accounts general ledger balance sheet income statement it is mostly it was it
is night you know if there’s a hundred journal entries or one hundred
transactions 9595 or up it’s good ninety five ninety five percent is gonna be
from the checking account so what happened in our what’s going on there
general ledger checking account this time at four thirty fifteen we added two
thousand dollars and started at 115 with ten thousand – four thousand – four
thousand plus two thousand so it has four thousand so our checking account
has four thousand dollars now so what happens over here check account four
thousand dollars energy in our general ledger checking account which is
serviced two thousand dollars in our widget service general ledger account
now now I’m gonna have super fun if you thought the checking account was fun
alright looks great jump cut back yeah boy now if I said if you thought that
was fun this is a lot of fun this is like super duper fun now this is the
balance sheet and the income statement I want to say again the reason why because
when I started working somewhere I had the income statement on top of the
balance sheet and my like mentor a guy said no no balance sheet goes on first
and I’m like why and he goes just because it’s just is but through the
years this is about four years ago or something three four years ago so now I
figured out the reason the balance sheet goes on top is because the income
statement is revenue minus expenses equals net income so the totality of the
income statement in net income flows over to the balance sheet so we’ve
looking at the balance sheet being on the financial statements you can see
what’s out what’s going on with assets equal liabilities plus equity so you can
see all that and you can see the totality of revenue expenses so you can
see the whole business and a snapshot into it in like two seconds with the
balance sheet now the income statement for now is one one fifteen that’s when
we started our business to four thirty fifteen that’s how it is now so it’s the
period income statement is a period boom boom
as you can see it’s January to April in 2015 the balance sheet is one point in
time it’s just for right now right today or the time now because it was probably
sometime in May by the time we’re doing these journal entries because you’re in
accounting you’re kind of working behind right so balance sheets for thirty fifteen
what did what happened this time this time we we finally made some serve we
finally made some revenue so so we got two thousand minus 4 thousand equals
negative two thousand net income see I think it was we did have we didn’t have
this so it was negative four thousand net income was negative four thousand
over here but now we made two thousand dollars so now we have only negative two
thousand dollars net income so we made two thousand we’ve decreased our our
lost by two thousand dollars so that slides over to here now what’s with it
what’s over there balance Jim for thirty fifteen a couple things changed over
here and are attracted account we went from having two thousand dollars and we
made two we made two thousand dollars we have four thousand dollars in our
checking account and our truck is still in the books for four thousand dollars
so we have a total of eight thousand dollars in our assets now is that going
to equal is that going to equal our liabilities plus equity the liabilities
didn’t change the equity did change because it was negative four thousand
dollars but now it’s negative two thousand dollars
so our equity is negative two thousand dollars our liabilities ten
that’s $8,000 for liabilities and equity does that match libel assets yes it does
well well well that was the oh well well well well though is that I always look
up there that was never 76 so can you believe we’re almost on 76 I’m going to
try to do this more often to where go faster and not talk so much
about anything else but the actual problem at hand and then if I have
because my my camera when he goes to 16 minutes and then it shuts off so I’m
gonna run it out to 660 I’m gonna basically I’m going to talk try those
times as I can so I can talk at the end of the video and so you don’t have to
like skip through the videos because I talk to my sure that we’re getting
enough to skip through the Hat find out where I started I don’t know I’m talking
a lot right now but just something goes through my head I finally I think I
finally found a good time to film and just do my life now Express and really
until next tax season so what I’m gonna do I’m gonna be professional about it
I’m gonna keep all the negative thoughts out of my head because I have so many
negative thoughts going running through my head it’s really a full-time job like
I don’t know how many hours I guess you’re awake 16 hours a day I’m trying
to fight off the negative voices in my head like 14 of those day 14 of the 16
hours and I’m awake it’s true it’s really hard for me and yeah I try I
just I am really trying to do it and I guess doings doing stuff that I like
doing helps me stay in a positive mood so I like getting here in the morning at
3 o’clock and doing these accounting for beginners I love it actually anyways I’m
bad at time look stay positive don’t hate people be nice uplift people why
you gonna remember to be a piece of shit fucking scumbag hater right like be
remembered uplifting people deuces nothing shaking
about my goddamn car keys

9 thoughts on “Accounting for Beginners #76 / Getting Paid with Service Revenue / Income Statement / Widget INC #4

  1. I just wanted to say thank you. I have been doing office admin for over 15 years, and never once fully understood the chart of accounts and how thy are linked until I stumbled upon your videos 2 days ago.
    Yes I can do bank recs, journal entries, write offs etc, but I only knew accounts to chose based on what I had chosen in the past. Now I know I can make informed decisions when deciding on which account to use.

    76 videos in, and mate you are a legend thank you!!

    If I could just get my head around setting up payroll on the ledger…

  2. love all you classic series your friend/student from LA , does revenu from services get listed twice once in the income statement as a debit on the left side and once in the balance sheet as revenue under equity or its already part of transfer net revenue or less from the income statement

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