Push each transaction through the four steps and watch debits and credits stay equal.
Owner invested $30,000 cash in exchange for common stock.
Source document: Bank deposit slip and stock certificate
No accounts posted yet.
Nothing posted yet.
Every transaction goes through the same four steps. Identify the source document and the event. Analyze which accounts and elements change, and which way. Journalize the debit and credit lines, then post the amounts to the ledger. December 15 needs three lines, not two — one debit to Accounts Receivable, two credits, one to each revenue account.
December 26's cash advance is the trap. Cash comes in before any consulting is done, so the credit is Unearned Consulting Revenue — a liability — not revenue. Revenue is only recorded once the work is delivered.