Pratica di Shadowing: ACCOUNTING BASICS: a Guide to (Almost) Everything - Impara a parlare inglese con i video

Accounting is like a big tree.

It's been around for ages and it has lots of branches.

There's financial accounting, managerial, tax, audit and bookkeeping.

But generally, I think when people say accounting, they usually mean financial accounting.

So what is financial accounting?

It's the process of identifying,

recording, summarizing and analyzing an entity's financial transactions and reporting them in financial statements.

Hey I'm James and if this definition doesn't mean much to you it's all good.

Stick around me for the next 10 minutes or so and you'll see exactly how financial accounting works.

We've got a lot to cover

but I do recommend watching this right through to the end at least once

so that you can get an idea of the big picture.

Let's do this!

Imagine that you own Rough Times, a tabloid newspaper covering all the latest gossip on our furry friends.

During March you run a promotional offer for annual subscriptions

that begin on April 1st. People can't get enough of your stories and you end up with $40,000 in new subscriptions.

All paid for in cash.

The first step in financial accounting is to identify the transaction.

Well that's easy, I just mentioned one.

You made $40,000 in new annual subscriptions.

These start on April 1st and continue through to March 31st next year.

So what next then?

It's time to prepare a journal entry.

A journal is a record of a financial transaction.

And it looks like this.

You have a unique journal number, a date, a description, the accounts affected, in this case that's cash and subscription revenue.

And then you have your debits and credits, which are both $40,000.

Rough Times is a serious business so you're using double entry accounting

which means this transaction affects at least two accounts and the total debits are equal to the total credits.

But why do we do it this way?

What is double entry accounting?

The first thing you need to know is that financial accounting is built on one simple idea.

The stuff that your business owns is equal to the stuff that your business owes.

We call the stuff that your business owns assets.

These are valuable resources that you'll benefit from in the future.

Things like cash and inventory.

But on the other side of this formula we use two different words to describe the stuff that your business owes.

Liabilities when you owe stuff to third-party lenders or suppliers.

These are your obligations that you'll need to fulfill in the future.

And equity when rough times owes stuff to you the owner this represents your claim on the business's net assets.

So assets equal liabilities plus equity.

This little formula is called the accounting equation and it has big implications.

It was written down a long time ago by this guy in this book and it revolutionized the way we record transactions.

It's the foundation of double entry accounting,

the theory that there are at least two equal and opposite sides to every transaction because this accounting equation is always true, it must always balance.

Debits and credits are the words we use to reflect these two sides.

Credits represent the sources that economic benefit flows from, whereas debits represent the destinations that it flows to.

Nowadays, pretty much every large business in the world uses double entry accounting, and so does rough times.

In this case, you debit cash by $40,000 to increase your assets,

and you credit subscription revenue by $40,000 to record your income.

Are you hanging in there?

I know there's a lot to take in, and Some of these terms might not make sense right away, but that's okay.

Just give it some time and let it all seep in.

After this, you can always jump into my accounting basics playlist and explore everything I mention in a lot more detail.

I'll drop a link to that down below in the description, just below that big red subscribe button.

I don't know what voice that was, but...

Anyway, the next step is to post the journal into your general ledger.

The General Ledger is a place where you store all of your financial data.

It contains a complete record of your accounts and journal entries.

Back in the day, it used to be this huge book that you'd fill out by hand.

But thankfully, we've moved on now, and businesses like yours use accounting software, which treats the General Ledger as kind of a central database.

So how do we get this journal into your General Ledger?

You post it to your accounts.

Accounts are places where you record, sort and store all transactions that affect a related group of items.

Broadly speaking, there are six types of account.

Assets, liabilities and equity, which we already know from the accounting equation.

And then there's revenue, expenses and withdrawals, also known as dividends.

These feed into the equity part of the equation.

If you'd like to see how and why that works, then you can check out my video on equity.

I'll pop a link to that in the description.

This journal affects two accounts and we can picture what they look like by drawing out two T's

and labeling them cash and subscription revenue.

These are called T accounts and they help us visualize what your accounts look like.

Debits go on the left and credits go on the right.

When you post this journal, you debit the left-hand side of your cash account by $40,000

and you credit the right-hand side of your subscription revenue account by $40,000 as well.

When we total these up, you now have $48,000 in cash and you've made $75,000 in subscription revenue.

But Rough Times has other accounts too.

It has a whole collection of assets, liabilities, equity, revenue and expense accounts stored in your general ledger.

You post this journal during March when you collect the cash.

But now let's fast forward to the end of your financial year, to December 31st. We need to put together your unadjusted trial balance.

What's a trial balance?

It's an internal report that summarizes the closing numbers in all of your general ledger accounts.

It can help us check for errors, but ultimately we use it to make financial statements, as you'll soon see.

But what does it look like?

Here's your general ledger again and now let's jump ahead to the end of December.

Building a trial balance is actually quite simple.

You list out all of your accounts and their closing balances and that's all there is to it.

A closing balance is the cumulative total of all transactions affecting an account.

As usual, debits are on the left and credits are on the right.

At the bottom of your trial balance, you have your total debits and total credits.

These should match each other exactly because the accounting equation is always true.

Trial is another way of saying test, which is what the trial balance was originally used for as a test to check your debits and credits are in balance.

And this is an unadjusted trial balance because we haven't adjusted it yet.

But we will.

Now actually.

Because you've ended a financial year, so we need to post some adjusting entries.

Adjusting entries are journal entries that bring your books in line with something called the accrual method of accounting.

What's that?

100

To understand, you really need to know about the accounting rule books.

101

Yes, accountants have to be good and follow the rules.

102

But the rules change a bit depending on where you're based.

103

You might follow the international financial reporting standards or some variation of the generally accepted accounting principles.

104

IFRS or GAAP These two rule books make sure that your financial statements reflect a true and fair view of your business.

105

Which is important because a lot of people rely on financial statements.

106

Particularly those who lent you money or invested in your business.

107

Anyway, IFRS and GAAP have one major thing in common.

108

They both want you to follow the accrual method of accounting.

109

Which means you need to recognize your revenue as you earn it and record your expenses as you incur them.

110

This is the most accurate way to calculate your profit.

111

But here's the thing.

112

Rough times hasn't been playing by the rules.

113

In March you ran a promotion for annual subscription starting on April 1st. You collected $40,000 in cash

114

and posted a journal to recognize

115

that whole amount as revenue on March 31st. This is called cash accounting and it's not the same as accrual accounting.

116

In cash accounting you recognize your revenue as you receive cash and record your expenses as you pay it out.

117

But receiving cash is not the same as earning revenue.

118

Let me show you.

119

You received $40,000 of cash during March, but you actually earn that revenue over the next 12 months.

120

This is when you do the work.

121

This is when you release each issue of Rough Times.

122

So today as things stand on December 31st, you've recognized 12 months of income this financial year,

123

but you haven't earned three months of it yet and you won't until the end of March next year.

124

But it's all good what adjusting entries are for.

125

These are the journal entries that you post to bring your books in line with the accrual method.

126

We can fix this situation by reversing 3 out of 12 months of your subscription revenue

127

which is $10,000 and temporarily holding it as a liability in an account called deferred revenue or unearned revenue.

128

This is a liability account

129

because you still have an obligation at the end of the

130

year to provide your customers with rough times from January to March.

131

Let's post this one to your general ledger and run ourselves a new adjusted trial balance.

132

This time it's adjusted because you've posted your adjusting entries.

133

We can see that your subscription revenue has gone down by $10,000 and your liabilities have gone up by $10,000.

134

Your debit and credit totals still match each other because there were two equal and opposite size to the journal.

135

And now you're playing by the rules because you're following the accrual method of accounting.

136

Nice one.

137

Now we can create your financial statements.

138

Financial statements are accounting reports that summarize your business's activities over a period of time.

139

These are external reports designed to give your investors, lenders and creditors an understanding of your business's financial health.

140

The three main financial statements are called the balance sheet, the income statement and the cash flow statement.

141

We can build all of these using your adjusted trial balance.

142

Your balance sheet looks like this.

143

It gives us a snapshot of your business's assets,

144

liabilities and equity at a single point in time which can teach the readers about your financial position.

145

They can see what you own and what you owe at the end of your financial year.

146

Now let's check out your income statement.

147

This summarizes your business's revenues and expenses over a period of time.

148

Here that's the previous year and it gives the readers a glimpse of your financial performance and profitability.

149

If you were cash accounting then this income statement would also mirror your cash flows.

150

But you're using the accrual method so profit and cash flow aren't the same thing.

151

You keep track of your cash flows separately in a cash flow statement.

152

This report summarizes your cash inflows and outflows over the same period of time.

153

Once you've created these three financial statements, you can send them out to your investors, lenders and creditors.

154

If rough times was listed on a stock exchange, then investors all around the world would compare your performance against their expectations

155

and decide whether to buy or sell shares in your business.

156

They'd analyze your statements using financial ratios, which is something that we haven't covered on this channel yet.

157

So if you'd like to see some videos on that, then by all means, please let me know down in the comments.

158

But we're not finished yet.

159

Once you're done with your financial statements, you need to post some closing entries to prepare your books for next year.

160

A closing entry is a journal entry that you post to clear out all of your temporary accounts like revenues, expenses and dividends.

161

For rough times, your journal would look something like this.

162

You'd debit your revenue accounts and use credit to your expense accounts to clear them down to zero.

163

The balance of $26,440 goes to retained earnings in the equity section of your balance sheet.

164

These are your profits that you're holding on to for the future.

165

So if we look at your trial balance again, then we can see your revenue and expense accounts have been reset to nil.

166

And now you're ready to tackle the new year.

167

Together these steps make up the the accounting cycle.

168

And this is what financial accounting is all about.

169

It's the process of identifying, recording, summarizing and analyzing your business's financial transactions and reporting them in financial statements.

170

Shout out to Manesh at Home Food Maniacs for requesting this one a long time ago.

171

So thanks for being so patient with me and thank you for subscribing.

172

We've now hit 100,000 subscribers on this channel, which is mental.

173

If you'd like to support this channel then you're welcome to buy my cheat sheets.

174

I've added a new one covering the accounting cycle which we just went through.

175

Or you can hit that join button below.

176

And if you'd like to learn more about accounting then I recommend starting right here.

177

Thanks for watching and I'll see you in the next one.

Cos'è la tecnica dello Shadowing?

Shadowing è una tecnica di apprendimento delle lingue supportata da studi scientifici, originariamente sviluppata per la formazione dei traduttori professionisti e resa popolare dal poliglotta Dr. Alexander Arguelles. Il metodo è semplice ma potente: ascolti un audio in inglese di madrelingua e lo ripeti immediatamente ad alta voce — come un'ombra che segue il parlante con un ritardo di solo 1–2 secondi. A differenza dell'ascolto passivo o degli esercizi di grammatica, lo shadowing costringe il tuo cervello e i muscoli della bocca a elaborare e riprodurre simultaneamente i modelli di discorso reale. La ricerca dimostra che migliora significativamente la precisione della pronuncia, l'intonazione, il ritmo, il discorso connesso, la comprensione dell'ascolto e la fluidità del parlato — rendendolo uno dei metodi più efficaci per la preparazione alla prova di speaking dell'IELTS e per la comunicazione reale in inglese.

Pratica di Shadowing: ACCOUNTING BASICS: a Guide to (Almost) Everything - Impara a parlare inglese con i video

Perché praticare la conversazione con questo video?

Grammatica & Espressioni nel Contesto

Trappole di Pronuncia Comuni

Cos'è la tecnica dello Shadowing?