ACC151Chapt2 - Chapter 2: Accounting for Transactions...

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Chapter 2: Accounting for Transactions ANALYZING AND RECORDING PROCESSES Exchanges of economic consideration between two parties External Transactions : occur between organization and outside party Internal Transactions : occur within the organization How Do I Analyze These? 1) Analyze each transaction and event from source documents (ex: the owner contributed $30,000 dollars, Did I buy? Did I sell?) 2) Record relevant transactions and events in a journal in chronological order 3) Post information to ledger account (each account separate ledger) 4) Prepare and analyze the trial balance SOURCE DOCUMENTS Def: information analyzed that’s relevant Checks Employee earnings Bills from suppliers Purchase orders (I need to by x,y, and z, purchasing department orders) Bank statements Sales tickets (receipt) THE ACCOUNT AND ITS ANALYSIS Account : record of increases and decreases in a specific asset, liability, equity, revenue, or expense item Cash account, revenue account, etc.; number of accounts depends on what company needs General Ledger: record containing all accounts used by the company, detail Asset Accounts = Liability Accounts + Equity Accounts
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This note was uploaded on 02/22/2012 for the course ACC 151 taught by Professor Franklin during the Fall '08 term at Syracuse.

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ACC151Chapt2 - Chapter 2: Accounting for Transactions...

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