Recording Entries Using BSE
Recording Entries Using The Balance Sheet Equation
Learning Objectives
- Record entries using the balance-sheet equation (BSE) approach.
- Trace effects of entries to balance-sheet line items.
- Click the Express Route video below on recording entries.
- Click the Interactive Exercise to practice recording entries.
- If you’re ready to start the exercises, click the Exercise link below. Go back to the video if you need more help.
Express Video:
Click here for the Express Route video [12 minutes]
Exercises
Ready to do exercises? Click for exercises for this module
Take-aways:
Key terms:
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Balance-sheet-equation model- Record-keeping approach using a matrix to aggregate the effects of accounting entries where columns are accounts organized by the balance sheet equation (A=L+OE) and rows are entries or balances. Also referred to as BSE model.
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Account sign- Represents the account’s impact on its primary balance-sheet class (+/-).
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Entry sign- Represents the entry’s affect on the account, either increase or decrease (+/-).
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Mini-BSE matrix- Derived from the full balance-sheet-equation matrix by eliminating rows and columns that do not pertain to a specific entry.
