Lecture 3 - ACCT 1001 - ACCOUNTING 1A TRANSACTION ANALSYIS...

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1 ACCT 1001 - ACCOUNTING 1A TRANSACTION ANALSYIS AND GENERAL JOURNALS ABDUL RAZEED DISCIPLINE OF ACCOUNTING REQUIRED READING: CHAPTER 2 PAGES 78 -96 ( PLEASE BRING YOUR CALCULATOR WITH YOU. NO MOBILE PHONES PLEASE!) * Thanks to John Wiley & Sons for their kind permission in the use of some of the material from Carlon et.al.(2009) in these slides 2 Learning Objectives 1. Identify source documents and business transactions 2. Analyse the effect of accounting transactions 3. Explain the role of a general journal. Use it to record accounting transactions 4. Define debits and credits and their role in recording transactions
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3 Accounting Information Systems ± Accounting Information Systems { Collect and process data relating to accounting transactions and events AND { Communicate financial information to interested parties 4 Accounting Cycle Source Documents Journal Entries General Journal General Ledger Trial Balance Adjusting Entries Adjusted Trial Balance Financial Statements Closing Entries Trial Balance
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5 Accounting Transactions and Events ± Transactions are: { external exchanges of something of value (economic resources) between two or more entities ± Events are: { Do not involve an external party { E.g. include price increases in assets during an accounting period or the allocation of the cost of the long-lived assets of an entity to different accounting periods ± Accounting transactions and events must be recorded because they have an effect on assets, liabilities and equity 6 Accounting Transactions And Events ± Transactions that are not recorded: { Private (personal) transactions { Transactions relating to different businesses { Events which result in no change to economic resources/economic value
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7 Identifying Transactions ± Source Documents { Evidence of a transaction { Details (or information) that can be found on a source document typically includes: ± Date of transaction ±
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Lecture 3 - ACCT 1001 - ACCOUNTING 1A TRANSACTION ANALSYIS...

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