Chap2MAF3e

Chap2MAF3e - Financial and Managerial Accounting Chapter 2...

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Financial and Managerial Accounting Chapter 2 Analyzing & Recording Transactions McGraw-Hill/Irwin         
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External Transactions occur between the organization and an outside party. Internal Transactions occur within the organization. Analyzing and Recording Process Exchanges of economic consideration between two parties. 2-2
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Analyze each transaction and event from source documents Analyzing and Recording Process Record relevant transactions and events in a journal Post journal information to ledger accounts Prepare and analyze the trial balance 2-3
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Sales Tickets Bank Statements Purchase Orders Checks Source Documents Bills from Suppliers Employee Earnings Records 2-4
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An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item. The Account and its Analysis The general ledger is a record containing all accounts used by the company. 2-5
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Assets Accounts Assets Accounts Asset Accounts = The Account and its Analysis + Liability Accounts Liability Accounts Liability Accounts Equity Accounts Equity Accounts Equity Accounts 2-6
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Land Equipment Buildings Cash Notes Receivable Supplies Prepaid Accounts Accounts Receivable Asset Accounts Asset Accounts 2-7
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Accrued Liabilities Unearned Revenue Notes Payable Accounts Payable Liability Accounts Liability Accounts 2-8
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Equity Accounts Revenues Common Stock Dividends Expenses Equity Accounts Retained Earnings 2-9
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Liabilities Equity Assets = + The Account and its Analysis Common Stock Dividends Revenues Expenses + + 2-10
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Ledger and Chart of Accounts The ledger is a collection of all accounts for an information system. A company’s size and
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Chap2MAF3e - Financial and Managerial Accounting Chapter 2...

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