Accounting Notes Ch.1

Accounting Notes Ch.1 - ASSET= LIABILITIES + OWNERS EQUITY...

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Accounting Notes Chapter 1 Construct the accounting equation and define assets, liabilities, and owners’ equity - The accounting equation is ( Assets= Liabilities + Owners’ Equity) - Assets Everything of value held by the business - Liabilities (debts) or claims against the total assets of a business. - Owners’ Equity The su m of all claims against business assets by the owners. ASSETS = LIABILITIES + OWNERS’ EQUITY Dr Cr Dr Cr Dr Cr + - - + - EXPENSES REVENUES Dr Cr Dr Cr + - - + Analyze business transactions using the accounting equation CASH INVESTMENT BY OWNER ASSET= LIABILITIES + OWNERS’ EQUITY Cash + Com mon Stock + ASSET PURCHASED FOR CASH ASSET= LIABILITIES + OWNERS’ EQUITY Cash – Property and Plant + ASSETS PURCHASED ON ACCOUNT
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ASSET= LIABILITIES + OWNERS’ EQUITY Asset + Accounts Payable + REVENUE EARNED FOR CASH ASSET= LIABILITIES + OWNERS’ EQUITY Cash + Retained Earnings LIABILITY PAID WITH CASH ASSET= LIABILITIES + OWNERS’ EQUITY Cash - Accounts Payable – REVENUE EARNED ON ACCOUNT
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Unformatted text preview: ASSET= LIABILITIES + OWNERS EQUITY Accounts Receivable + Retained Earnings + EXPENSE INCURRED FOR CASH ASSET= LIABILITIES + OWNERS EQUITY Cash -Retained Earnings RECEIVABLE COLLECTED IN CASH ASSET= LIABILITIES + OWNERS EQUITY Cash + Accounts Receivable EXPENSE INCURRED ON ACCOUNT ASSET= LIABILITIES + OWNERS EQUITY Accts. Payable + Retained Earnings CASH DIVIDENDS DECLARED AND PAID ASSET= LIABILITIES + OWNERS EQUITY Cash -Retained Earnings Prepare simple versions of the four basic financial statements-Income Statement Revenues Expenses = Net income (net loss)-Statement of owners equity Common Stock - Retained Earnings Beginning Bal. Dividends + Net Income-Balance Sheet Assets Liabilities + Owners Equity Analyze financial Statement Information for real-life companies...
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Accounting Notes Ch.1 - ASSET= LIABILITIES + OWNERS EQUITY...

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