Chapter_3_Notes

Chapter_3_Notes - Chapter 3 Objectives 1. Learn the effect...

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Chapter 3 Objectives 1. Learn the effect of transactions on the Accounting Equation . 2. Learn what an Account is and its function in the Recording process. 3. Define and explain Debits and Credits and how they are used to record transactions. 4. Identify and explain the basics steps in the Recording Process . 5. Explain and understand the uses of Journals and Ledgers . 6. Learn how to Post transactions from the Journal to the Ledger ( Posting) . 7. Learn what a Trial Balance is, its limitations and how to prepare it.
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Transactions Transactions are events that must be recorded in the Accounting Records. Not all events of a business must be recorded. For instance: Purchase a computer – Yes , it must be recorded Pay Rent – Yes , it must be recorded Hire a new Secretary – No , it doesn’t need to be recorded until work has been performed. The criteria for recording a transaction is to determine if the Financial Position ( Assets, Liabilities or Stockholder’s Equity ) has changed? If yes, the transaction must be recorded.
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Chapter_3_Notes - Chapter 3 Objectives 1. Learn the effect...

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