ACG2021 Chapter 2 - credit o Increases in liabilities and...

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
ACG2021 Chapter 2 Transaction – is any event that has a financial impact on the business and can be measured reliably o You give something o You receive something Account – Is the record of all the changes in a particular asset liability or stockholders equity during a period. Assets – cash, accounts receivable, notes receivable, inventory, prepaid expenses, land, buildings, equipment, furniture, fixtures. Liability- accounts payable, notes payable, accrued liabilities. (interest payable, salary payable) Stockholders equity – common stock, retained earnings, dividends, revenues, expenses Debit – shows what you received Credit – shows what you gave Rules of debit and credit – increases in assets are recorded on the left side ( debit ). Decreases in assets are recorded on the right side (
Background image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: credit ). o Increases in liabilities and stockholders equity are recorded by credits . Decreases in liabilities and stockholders equity are recorded by debits. o Dividends and expenses are increased by a debit they are contra equity accounts • Journal – chronological record of transactions. • Ledger – a grouping of all the T-accounts with their balances. o Contains the accounts grouped under these headings: Balance sheet accounts: assets, liabilities, stockholders equity Income statement accounts: revenues and expenses • Trial balance – list all accounts with their balances. Summarizes all the account balances for the financial statements and shows whether total debits equal total credits. • • • • • • •...
View Full Document

This note was uploaded on 02/09/2012 for the course ACG 2021C taught by Professor Mcdonald during the Spring '08 term at University of Florida.

Ask a homework question - tutors are online