Chapter 2
Each account in the general ledger is numbered for easier identification. True or False?
True
The general ledger is sometimes referred to as simply the ledger. True or False?
True
True or False; Credits = Debits
True
Debits
An entry recording an amount owed, listed on the left-hand side or column of an account. The opposite of credit.
Is the following a Credit or a Debit? - Accounts Payable
Credit
Is the following a Credit or a Debit? - Common Stock
Credit
Is the following a Credit or a Debit? - Service Revenue
Credit
Is the following a Credit or a Debit? - Unearned Service Revenue
Credit
Is the following a Credit or a Debit? - Cash
Debit
Is the following a Credit or a Debit? - Dividends
Debit
Is the following a Credit or a Debit? - Prepaid Insurance
Debit
Is the following a Credit or a Debit? - Rent Expense
Debit
Is the following a Credit or a Debit? - Salaries and wage expense
Debit
The accounts in the general ledger are arranged in alphabetical order. True or False?
False
The general ledger contains all the asset and liability accounts, but no stockholders' equity accounts True or False?
False
The general ledger is a book of original entry. True or False?
False
How does this info flow through the accounting system? - Debits and credits posted to the ledger. - Business transaction occurs. - Information entered in the journal. - Financial statements are prepared. - Trial balance is prepared.
1.) Business transaction occurs. 2.) Information entered in the journal. 3.) Debits and credits posted to the ledger. 4.) Trial balance is prepared. 5.) Financial statements are prepared.
General Ledger
A general ledger contains all the accounts for recording transactions relating to a company's assets, liabilities, owners' equity, revenue, and expenses.
Credits
The granting of a loan and the creation of debt. Any movement of financial capital is normally quite dependent on credit, which in turn is dependent on the reputation or creditworthiness of the entity which takes responsibility for the funds.