Step 1 Journalizing transactions - joumal or T account Carson Cotering January 1, 2020 Transaction 1. Don Carson invested $30,000 in the business Transaction 2. The business spent $280 in advertising Transaction 3. The business purchased a one-year insurance premium of $4,800 using loan from the bank. The insurance coverage is from Jan 1, 2020 through Dec. 31, 2020. Transaction 4. The business catered a dinner party and received $3,500 Transaction 5. Don Carson withdrew $5,500 from the business Accounts you will use include Cash, Capital, Drowing, Advertising Expense, Notes Payable, Catering Revenue, Prepaid Insurance, Insurance Expense, Income Summary Step 2 Posting - transfer the debts and credits from journals to the ledger accounts Step 3 Trail Balance - summarizing the ledger accounts to prove the equality of debits and credits 1 Step 4 Preparing adjusting entries - determining the adjustments and recording them in the general journal The one month's insurance Step 5 Posting adjusting entries Step 6 Adjusted trail balance Step 7 Financial statements - rearranging the adjusted trial balance into an income statement and a balance sheet I Step 8 Recording and posting closing entries I Step 9 Post-closing trial balance