AccountingPrinciplesTheRecordingProcess幻灯片.pptxVIP

;;Record of increases and decreases in a specific asset, liability, owners’ equity, revenue, or expense item. Debit = “Left” Credit = “Right”;Double-entry system Each transaction must affect two or more accounts to keep the basic accounting equation in balance. Recording done by debiting at least one account and crediting at least one other account. DEBITS must equal CREDITS.;$10,000;If the sum of Credit entries are greater than the sum of Debit entries, the account will have a credit balance.;Assets - Debits should exceed credits. Liabilities – Credits should exceed debits. Normal balance is on the increase side.;Owner’s investments and revenues increase owner’s equity (credit). Owner’s drawings and expenses decrease owner’s equity (debit).;Debits and Credits;Normal Balance Credit;Illustration 2-11;;Business documents, such as a sales slip, a check, or a bill, provide evidence of the transaction.;Book of original entry. Transactions recorded in chronological order. Contributions to the recording process: Discloses the complete effects of a transaction. Provides a chronological record of transactions. Helps to prevent or locate errors because the debit and credit amounts can be easily compared.;JOURNALIZING - Entering transaction data in the journal.;SIMPLE AND COMPOUND ENTRIES;LO 2;DO IT!;DO IT!;General Ledger contains all the asset, liability, and owner’s equity accounts.;;The Ledger;POSTING Transferring journal entries to the ledger accounts. ;Posting: normally occurs before journalizing. transfers ledger transaction data to the journal. is an optional step in the recording process. transfers journal entries to ledger accounts.;Chart of Accounts;Follow these steps: 1. Determine what type of account is involved. 2. Determine what items increased or decreased and by how much. 3. Translate the increases and decreases into debits and credits.;LO 3;;;;;The Recording Process Illustrated;;;;Summary Journalizing and Posting;Illustration 2-29;LO 3;DO IT!; ;Trial bala