Verify the equality of the equation after performing calculations. Indicate increase or decrease effect of given transactions on the fundamental accounting equation. Owner's equity List and define the temporary owner's equity accounts. Define net profit and net loss. Calculate net profit and net loss.
Income statement Prepare an income statement.
Balance sheet Prepare a balance sheet to verify the accounting equation. Debit an account by writing a number on the left side. Identify accounts that are credited to show a decrease. Identify the credit side of an account form or T account. Identify accounts that are credited to show an increase.