ACC 221 1st Edition Lecture 3Outline of Previous Lecture- Chapter 2: Getting to know the Accounting System Accounting Systemo Accounting system reportingo Staying in balance o Common Stocko General JournalOutline of Current Lecture - Chapters 1 & 2: Additional Facts About Accounting System Accounting Systemo Traditional accounting system routineo Asset, Liability, Owner’s Equity Accounts Additional Factso Entries don’t have to affect different sides to stay in balanceo No set accounting periodsCurrent Lecture- Chapters 1 & 2: Additional Facts About Accounting System Accounting Systemo All entries must follow the traditional accounting system routine: General Journal General Ledger Trial Balance Balance Sheeto Asset Accounts include: Cash Inventory Equipmento Liability Accounts include:- Notes Payable– Non-owner’s claim to assetso Owner’s Equity accounts include:- Common Stock Additional Facts:These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.o Entries do not have to affect both sides of the accounting equation (Assets & Liabilities + Owner’s equity) in order to remain in balance When buying inventory or equipment, transaction only affects the Assets. Thisis because we are removing (crediting) the cash of our assets, in order to add (Debiting) additional inventory or equipment. o Accounting cycle does not report on a specific time period, such as a month or yearly basis, but can occur any time. - Accounting cycle – steps an accounting system goes through for each accounting period- Balance sheet – point in time financial report, giving data for a specific accounting
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