Mgmt 200 Spring 2010 Chap 3 Processing Accounting Information

Mgmt 200 Spring 2010 Chap 3 Processing Accounting Information

Info iconThis preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon
Processing Accounting Information Chapter 3
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
The Accounting Cycle During period Analyze transactions Record journal entries Post amounts to the general ledger At end of period Adjust revenues and expenses for unrecorded items Prepare financial statements Close revenue, expense, and dividend accounts and update the retained earnings account Repeat for next period
Background image of page 2
Transaction Analysis Processing of accounting information, or transaction analysis Bookkeeping Analyze each transaction in terms of its impact on the accounting equation Eventually will look at Dr and CR rules, the general journal, and the general ledger.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
The accounting process TRANSACTIONS (Events) occur. Transaction data is recorded on SOURCE DOCUMENTS. Each transaction is analyzed in terms of impact on the accounting equation and ENTERED in the JOURNAL. (Journal entry) The information in the journal entries is POSTED to the LEDGER. (Ledger account) [A listing of the ledger account balances is a TRIAL BALANCE]
Background image of page 4
Problem 3-3 Transaction Analysis and Financial Statements Expert Consulting Services Inc. was organized on March 1, 2008, by two former college roommates. The corporation will provide computer consulting services to small businesses. The following transactions occurred during the first month of operations: March 2: Received contributions of $20,000 from each of the two principal owners of the new business in exchange for shares of stock. March 7: Signed a two-year promissory note at the bank and received cash of $15,000. Interest along with the $15,000, will be repaid at the end of the two years.
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
March 12: Purchased $700 in miscellaneous supplies on account. The company has 30 days to pay for the supplies. March 19: Billed a client $4,000 for services rendered by Expert in helping install a new computer system. The client is to pay 25% of the bill upon its receipt and the remaining balance within 30 days. March 20: Paid $1,300 bill from the local newspaper for advertising for the month of March. March 22: Received 25% of the amount billed the client on March 19. March 26:
Background image of page 6
Image of page 7
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/04/2012 for the course MGMT 200 taught by Professor Greigg during the Spring '08 term at Purdue University.

Page1 / 19

Mgmt 200 Spring 2010 Chap 3 Processing Accounting Information

This preview shows document pages 1 - 7. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online