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

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

Ask a homework question - tutors are online