ACCTG 211: Week 2 Notes
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This 2 page Class Notes was uploaded by Alicia Polcha on Saturday January 23, 2016. The Class Notes belongs to 211 at a university taught by Prof. Herrick in Spring 2016. Since its upload, it has received 8 views.
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Date Created: 01/23/16
Chapter Two: The Recording Process 1. Account: record of increases and decreases in specific assets, liability, equity, revenue or expense item. 2. Debits and Credits: a. Double entry accouting system: i. Each transaction must affect 2+ accounts to keep the basic accounting equation in balance ii. Recording done by debiting atleast one account and crediting atleast one other account iii. Total debits MUST EQUAL total credits iv. If debits > credits, account will have a debit balance v. If credits > debits, accounts will have a credit balance b. Debits Increase: Assets, Drawing, Expenses c. Credits Increase: Liability, Capital, Revenue 3. Assets and Liabilities a. Assets: debits should exceed credits b. Liabilities: credits should exceed debits c. The normal balance is on the increase side d. Every transaction will have both debit and credit entries 4. The Journal: a. Book of original entry b. Transactions recorded in chronological order 5. Chapter Two Overview: a. Journal Entries Construction i. Label title of each column (There are five) ii. Column One: Date iii. Column Two: Acount Titles and Explanations iv. Column Three: Reference v. Column Four: Debit vi. Column Five: Credit vii. Fill in transactions in chronological order b. TChart Construction i. Literally a chart that looks like a “T” ii. Include account titles (from journal entries) on top of chart iii. Include date along side of left column iv. Left column is debit side 1. Here you list all debits v. Right column is credit side 1. Here you list all credits c. Trial Balance Construction i. Header Row: Date Debit Credit ii. Follow header row with: Account Titles of TCharts 1. These will be lined down the columns in chronological order iii. include numbers under either debits or credits columns iv. Total all debits and all credits at the end v. Do not combine the two quanities of debits and credits d. Standard Account Form i. Account Title at Header Row ii. Second Row: Date, Explanation, Reference, Debit, Credit, Balance iii. Continue this format for each different account title that is needed iv. Each will have its own table or standard account format
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