Acct 230 1st Edition Lecture 6Outline of Last Lecture II. Accounting Information & Decision Makinga. Careers in AccountingOutline of Current Lecture III. The Accounting Information Systema. Measuring Business ActivitiesCurrent LectureII. The Accounting Information Systema. Role of Financial Accountingi. Measure business activities of the companyii. Communicate those measurements to external parties for decision making purposesb. Measuring Business Activitiesi. Identify the basic steps in measuring external transactions1. Most business enterprises use a computerized accounting system due to the sheer volume of data they must process.2. Computerized data processing is fast, accurate, and affordable3. Knowledge of manual accounting information system will provide an essential understanding of the basic model that underlies the computerized programsii. Classification of Business activities1. External Transactions:a. Use source documents to identify accounts affected by an external transactionb. Analyze the impact of the transaction on the accounting equationi. Each transaction will have a dual effect. If an economic event increases one side of the equation,it will also increase the other side of the equation by the same amount.ii. Ask yourself the following: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.1. What is the one account in the accounting equation affected by the transaction? Does that account increase or decrease?2. What is the second account affected by the transaction? Did it increase or decrease?3. Do assets still equal liabilities + stockholder’s equity?c. Assess whether the transaction results in a debit or credit to the account balanced. Record the transactione. Post the transaction to the T-Account in the general ledgerf. Prepare a trial balance2. Internal transactions do not involve an external
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