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A book of the ACCOUNTS used to record increases and decreases in the accounting system. A group of accounts for a business entity

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Ledger

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A list of accounts in the ledger, the accounts are normally listed in the order in which they appear on the financial statement

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Charts of accounts

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the process of recording a transaction in the journal

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Journalizing

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What are some examples of an Asset?

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Intangible assets include patent rights copyright and trademark, they also include accounts receivable prepaid such as insurance buildings equipment Land and cash

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the process of transferring the debits and credits from the journal entries to the account

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posting

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How to identify liabilities?

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are often identified on the balance sheet by titles "Payable" and "Unearned"

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What are some examples of revenues?

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Fees earned, fares earned, commission revunes, and rent revuene

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What are some examples of expenses?

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Examples of expenses including wages expense, rain expense, utilities expense, supplies expense, and miscellaneous expense

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What is included on the balance sheet accounts?

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1. Assets Cash, accounts recievable, supplies, prepaid insurance, land, office equipment 2. Liabilites Accounts payable Unearned rent 3. Stockholders equity Common stock Retained earnings Dividends

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When are Unadjusted Trial balance prepared?

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after the journal entries are posted.

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What is included on the income statement accounts?

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4. Revenue Fees earned 5. Expenses Wages expense Supplies expense Rent expense Utilities expense Miscellaneous expense

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How do you list expenses?

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largest to smallest with miscellaneous last

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The system is based on the account equation that requires: every business transaction to be recorded in at least two accounts, the total Deb it's recorded for each transaction to be equal to the total credit record

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Double entry accounting system

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Using the rules of the debit and credit transactions are initially into the record called what (a book where the transactions are listed the events in chronological order)

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Journal

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what is the left side of the t-account called?

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DEBIT

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what is the right side of the t-account called?

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CREDIT

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The normal balance of an asset account is?

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Increase in debit, decreases in credit

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The normal balance of a liabilities account is?

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increase in credit, decrease in debit

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is the same as the liabilities account because its on the same side of the equation increase in credit, decrease in debit

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The normal balance of the stockholders' equity account?

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The normal balance of revenues?

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adds to stockholders' equity, therefore the balance is increase in credit, decrease in debit

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The normal balance of Expenses?

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subtract from stockholders' equity, therefore the balance is the same as an asset account, increase in debit, decrease in credit

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subtracts from stockholders' equity, therefore the balance is the same as an asset account, increase in debit, decrease in credit

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The normal balance of dividends?

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What are the steps to take in the accounting cycle?

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1. Transaction 2. Journal entry is prepared 3. Transfer information from the journal to the ledger (accounts) - then you post it (T-Accounts). 4. Unadjusted Trial balance

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document is prepared as evidence of the what?

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Transaction

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errors occur in posting debits and credits from the journal to the ledger. One way to detect such as errors is by preparing

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trial balance

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list every account (with bal) separating the balance into a debit and credit column total the 2 columns to prove they are equal (checking for errors)

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Unadjusted Trial balance

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what are true about T-accounts?

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~The excess of the credits of a liability account over the debits is the balance of the account. ~The excess of the credits of a stockholders' equity account over the debits is the balance of the account.

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What is the journal entry to pay creditors on account would include?

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a debit to Accounts Payable

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How are debits and credits for each journal entry are posted to the accounts?

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in the order in which they occur in the journal.

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