Financial Accounting: Accounting Cycle Simternship | Account Definitions and Journal Entries

In each Round of this simulation, you will need to complete month-end adjustments in the Journal Entry Hub.

You can view the videos below if you'd like a brief refresher on journal entries and a review of how to make correct journal entries. These can also be found in the simulation when selecting "Help" in the upper right corner and then selecting "Help Guides."

You'll complete all the needed journal entries based on information provided in your Inbox. You can also view these in each Round by going to the Resources Tab in the bottom right corner. 

1. Begin Journal Entry: Select New Entry to begin a journal entry. The journal entry types are listed in the drop-down box titled "Select Type." Note: All of the journal entries must be completed.
2. Select Time Period: Select the time period for the entry.
3. Complete Journal Entries: Complete each journal entry by selecting the appropriate accounts and amounts to Debit and Credit. Note: Debits and Credits must be equal
4. Validate the Entry: After selecting the accounts and ensuring the Debits and Credits are equal, you will Validate the entry. You will have 3 attempts, after which the correct entry will be made available. You will be scored on your 3rd attempt, unless one of the previous attempts is correct.
5. Save Entry: If validation is successful, you will be able to select Save Entry and the entry will move to your Journal Entry list for future reference.

FAQ

Do I have to keep going back to my Inbox to review receipts to enter for the Journals?

You can download these invoices within the Inbox of that email. You can also view them in the Resources tab in the simulation. This is located in the bottom right-hand corner of the simulation, and you can sort through the different receipts, invoices, contracts, etc. 

Why can't I put in the entry? 

You'll want to make sure you put in both the Time Period and what the Journal Entry is for. Once you do so, you'll be able to put in each of the entries. If you are having trouble determining what the Journal Entry is for, you can go back to your inbox or view it in the Resources tab. 

What if I get the entry wrong?

If you incorrectly put in the Journal Entry, the simulation will let you know that the entry is incorrect. The simulation will grade you on your third attempt of the entry. After the third attempt, you will be given the correct entry to move on the simulation.

Definitions of Accounts for Journal Entries:

Category	Sub-Category	Account Name	Definition & Business Rule
1. ASSETS	1.1 Current	Cash	Coins, currency, money orders, checks, and bank deposits.
		Accounts Receivable	Money due from customers for services or merchandise sold on credit.
		Inventory	Goods held specifically for resale.
		Prepaid Insurance	Advance payments for insurance; recognized as assets and expired monthly.
		Prepaid Rent	Advance rent payments (often 3–6 months); recognized as assets and expired monthly.
		Office Supplies	Items held for business use (not resale); expensed as they are used.
		Business License	Annual licenses recognized as assets and expired monthly.
	1.2 Non-Current	Property, Plant, & Equipment	Tangible, long-lived assets (buildings, machinery, etc.) to be depreciated.
		Accumulated Depreciation	Contra asset account tracking total depreciation to date.
2. LIABILITIES	2.1 Current	Accounts Payable	Used expressly for purchasing inventory on an IOU (on account).
		Bank Loan Payable	Debt obligation to a bank; distinct from general Notes Payable.
		Notes Payable	Longer-term liabilities; used specifically to purchase equipment on account.
		Unearned Revenue	Cash received before goods or services are provided (an obligation).
3. OWNER'S EQUITY	3.1 Equity	Common Stock	Source of cash received from investors.
		Retained Earnings	Profits kept in the business for future use rather than paid as dividends.
4. REVENUE	4.1 Operating	Sales Revenue	Revenue from the sale of inventory.
		Rental Revenue	Revenue from providing rental services.
	4.2 Other	Gain on Sale of Equip.	Profit recognized if equipment is sold for more than its cost.
5. EXPENSES	5.1 Direct	Cost of Goods Sold	Costs to purchase or make merchandise sold during the period.
	5.2 Operating	Advertising Expense	Costs for marketing, promotions, and giveaways.
		Payroll Expense	Costs associated with paying employees.
		Repairs & Maintenance	Costs for keeping assets in working order.
		Utilities Expense	Costs for electricity, water, and gas.
		Business License Exp.	Monthly expiration of the annual business license asset.
		Depreciation Expense	Monthly "using up" of equipment over its 2-year useful life.
		Insurance Expense	Monthly expiration of the prepaid insurance policy asset.
		Office Supplies Exp.	Recognition of office supplies used during the month.
		Rent Expense	Monthly expiration of the prepaid lease asset.
	5.3 Financial	Interest Expense	The cost of borrowing money from banks or vendors.
		Income Tax Expense	Taxes owed or paid to the government.