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Basic Accounting Module 1 (Topic 5)
Basic Accounting Module 1 (Topic 5)
Basic Accounting Module 1 (Topic 5)
TOPIC # 5: OUTCOMES:
BOOKS OF Identify the major accounts in
ACCOUNTS applying the accounting equation to
account for the values of financial
AND THE statement items.
DOUBLE-ENTRY
SYSTEM
READING ASSIGNMENT:
Financial Accounting and Reporting
Fundamentals by Zeus B. Millan: Pages
138-154
Note: While reading Chapter 5, draft out your personal summary notes on your notebook. Your
instructor highly encourages that you use illustrations, diagrams, tables and the like. Be creative!
These personal summary notes will become extremely useful by the time you reach your final
year in the Accountancy program and during your formal review for the CPA Licensure
Examination, so make sure to give your best in simplifying what you can!
LECTURE NOTES
GENERAL LEDGER – all accounts found in the trial balance are posted
here.
LEDGER
SUBSIDIARY LEDGER – shows a breakdown of the amounts presented
under the controlling accounts, i.e. Accounts Receivable, etc.
General journal/Book of original entry.
Accountable transactions are recorded in a chronological manner based on their dates
using the double-entry system.
Special journals:
o Cash receipts journal. A special journal used to record cash sales, and collection of
accounts receivable.
o Cash disbursements journal. A special journal used to record the payment for cash
purchases, expenses, or payables.
o Sales journal. A special journal used to record sales on credit.
o Purchases journal. A special journal used to record purchases on credit.
General ledger/Book of final entry.
The journal entries from the general journal are summarized per account to get their
respective ending balances.
CONCEPTUAL PORTFOLIO
Prepare the accounts to be debited and credited for the following transactions.