Accounting 230 Chapter 2
use source documents to identify accounts affected by external transactions
1
analyze the impact of the transaction on the accounting equation
2
assess whether the impact of the transaction results in a debit or credit to the account balance
3
record transactions using debits and credits
4
post the transaction to the T- accounts in the general ledger
5
prepare a trial balance
6
summary of the effects of all transactions related to a particular item over a period of time
account
determine the dual effect of business events on the accounting equation
analyze transaction
pay employees 6,000 for the first months salaries
asset decrease and stockholders equity decreases
purchase advertising to appear in the current month 1,200
asset decrease and stockholders equity decreases
purchase office supplies for 2,000 on account
asset increase and liabilities increase
purchase office supplies on account for 2,500
asset increase and liabilities increase
receive cash of 5,000 in advance from customers who plans to have his house painted in the following month
asset increase and liabilities increase
receive cash of 12,000 in rental fees for the current month
asset increase and stockholders equity increase
purchase land for 19,000. A note payable is signed for the full amount
asset increases and liability increase
pay employee salaries of 3,200 for the current month
assets decrease and stockholders equity decrease
pay office rent of 4,400 for the current month
assets decrease and stockholders equity decreases
issue 10,000 shares of common stock in exchange for 32,00 in cash
assets increase and stockholders equity increases
paint house in the current month fro 15,000 on account
assets increase and stockholders equity increases
pay rent for the current month
decrease asset decrease stock holders equity
pay insurance for the current month
decrease asset decrease stockholders equity
provide services to customers on account
increase asset increase stockholders equity
purchase equipment by signing a note payable
increase assets increase liability
issue common stock in exchange for cash
increase assets increase stockholders equity
record of all transactions affecting a company
journal
hire three employees for 2,000 per month
no effect
collect cash from customers on account
no effect for assets liabilities or stockholders equity
purchase painting equipment for 16,000 cash
one asset increase and another asset decreases
purchase storage container equipment for 8,000 cash
one asset increase and another asset decreases
receive 10,000 from customers in (1) above
one asset increase and another asset decreases
transfer balances from the journal to the general ledger
post
list of accounts and their balances
trial balance
