CHAPTER 2 BMGT220 NOTES 9 16 13 Analyzing Transactions an accounting form that s used to record the increases and account decreases in each accounting equation element LEFT SIDE DEBITS RIGHT SIDE CREDITS account in simplest form has 3 parts title space for increases space for decreases t account right side credit credits diff btwn debits and credits always on side of bigger value Ledger Chart of accounts equation that requires every business transaction to be recorded in at least 2 accounts and total debits to be equal to total credits Dividends Double entry accounting system simplest form of an account resembles letter T left side debit the excess of the debits of an asset account over it s distributions of earnings to stockholders a system based on the accounting a group of accounts for a business list of the accounts in ledger Balance of the account normal balance of an account Double entry accounting system requires either a debit or a credit balance depending the initial record in which effects of transactions are recorded title of account to be debited title of account to be credited every business transaction to be recorded in at least 2 accounts the total debits recorded for each transaction to be equal to total credits recorded on whether increases in the account are recorded as debits or credits journal 1 date 2 3 4 brief description 5 posting reference column entires to the accounts trial balance ledger in double entry accounting DEBITS MUST EQUAL CREDITS accounts in the ledger prior to the posting of adjusting entries statement w the same item in prior statements add debits and credits determine balance summary listing the titles and balances of accounts in the summary listing of the titles and balances of financial analysis that compares an item in a current the process of transferring the debits and credits from the journal unadjusted trial balance horizontal analysis posting ASSETS EXPENSES DIVIDENDS credit debit DEAD LIABILITIES REVENUE OWNER EQUITY credit debit COLR compound journal entry which is 2 or less accounts you do NOT remake account entry if there is more than one ex different kinds of revenue different kinds of accounts more than 2 accounts vs simple journal entry cash
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