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    Analyzing & Recording Business Transactions

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    Juan Po
    This document discusses analyzing and recording business transactions in accounting. It describes source documents, accounts, ledgers, and the basic types of accounts including assets, liabilities, equity, revenues and expenses. It also covers the chart of accounts, T-accounts, the accounting equation, journals, journal entries, and the processes of journalizing and posting transactions. Sample business transactions are provided to demonstrate journal entries.

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    Analyzing & Recording Business Transactions

    Uploaded by

    Juan Po
    8 views16 pages
    This document discusses analyzing and recording business transactions in accounting. It describes source documents, accounts, ledgers, and the basic types of accounts including assets, liabilities, equity, revenues and expenses. It also covers the chart of accounts, T-accounts, the accounting equation, journals, journal entries, and the processes of journalizing and posting transactions. Sample business transactions are provided to demonstrate journal entries.

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    Original Title

    Chapter 2

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    This document discusses analyzing and recording business transactions in accounting. It describes source documents, accounts, ledgers, and the basic types of accounts including assets, liabilities, equity, revenues and expenses. It also covers the chart of accounts, T-accounts, the accounting equation, journals, journal entries, and the processes of journalizing and posting transactions. Sample business transactions are provided to demonstrate journal entries.

    Copyright:

    © All Rights Reserved
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    8 views16 pages

    Analyzing & Recording Business Transactions

    Uploaded by

    Juan Po
    This document discusses analyzing and recording business transactions in accounting. It describes source documents, accounts, ledgers, and the basic types of accounts including assets, liabilities, equity, revenues and expenses. It also covers the chart of accounts, T-accounts, the accounting equation, journals, journal entries, and the processes of journalizing and posting transactions. Sample business transactions are provided to demonstrate journal entries.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
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    of 16

    Analyzing & Recording

    Business Transactions
    Chapter 2

    Source documents

    Identify and describe transactions


    and events entering the accounting
    process.

    Account
    Is a record of increases and
    decreases in a specific asset,
    liability, equity, revenue or expense
    Ledger

    Is a record containing all accounts used


    by a company

    Assets

    Cash
    Accounts
    receivable

    What customers
    owe us

    Note receivable
    Prepaid Accounts
    Supplies
    Equipment

    Liabilities

    Accounts payable

    Money owed to
    suppliers

    Notes payable
    Unearned revenue

    Deposits from
    customers

    Equity

    Common Stock

    Dividends

    Shareholders
    investment in the
    business
    Distributions of
    income to
    shareholders

    Retained Earnings

    Chart of Accounts
    List of an accounts a company uses
    and includes an idea.
    101-199 Assets
    201-299 Liabilities
    301-399 Equity
    401-499 Revenues
    501-599 Expenses

    T- Accounts

    Debit

    Credit

    Left side

    Right side

    Accounting Equation
    Assets
    DR CR

    Liabilities
    DR

    CR

    Equity
    DR
    CR

    Double entry accounting: each transactions affect,


    And recorded in, at least two accounts
    Debits = Credits

    Journal

    Journal

    Gives a complete
    record of each
    transaction in one
    place

    Journalizing

    Process of
    recording
    transactions

    Posting

    Process of
    transferring journal
    entry info to the
    ledger

    Journal
    Date

    Account

    PR

    Debit

    Credit

    Journal Entries

    Go to excel worksheet

    Transactions
    Shareholder invests in the business
    $30,000 in cash
    Co pays $2,500 cash for supplies
    Co pays $26,000 cash for equipment
    Co purchases $7,100 of supplies on
    account ( on credit)
    Co provides consulting services and
    collects $4,200 cash

    Transactions
    Co pays for $1,000 cash for rent
    Co pays $700 cash for salaries
    Co provides consulting services of
    $1,600 and bills the customer
    Co receives $1,600 cash from the
    client billed
    Co pays $900 on account
    Co pays dividends $1,000

    Transactions
    Co receives $3,000 cash in advance
    Co pays $2,400 cash for insurance
    for one year

    Posting to the ledger


    Record the transactions into ledger
    by account name
    Prepare a TRIAL BALANCE

    List of accounts and balances

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