Acct 230 1st Edition Lecture 7Outline of Last Lecture II. The Accounting Information Systema. Measuring Business ActivitiesOutline of Current Lecture III. The Accounting Information Systema. Debits & CreditsCurrent LectureII. The Accounting Information Systema. Debits & Creditsi. Assess Whether the Impact of External Transactions Results in a Debit or Credit to an Account Balance1. “Is there an increase or decrease in the first account involved in the transaction? Should I record that increase or decrease with a debit or a credit?”2. “Is there an increase or decrease in the second account involved in the transaction? Should I record that increase or decrease with a debit or a credit?”3. “Do total debits equal total credits?”ii. Post Transactions to T-accounts in the General Ledger1. The process of transferring the debit and credit information from the journal to individual accounts in the general ledger is called posting.2. A T-account is a simplified form of a general ledger account with space at the top for the account title and two sides for recording debits and credits.iii. Prepare a Trial Balance1. A trial balance is a list of all accounts and their balances at a particular date, showing that total debits equal total credits. 2. Another purpose of the trial balance is to assist us in preparing adjusting entries (for internal transactions). 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.3. It is not a published financial statement to be used by external parties, there is no required order for listing accounts in the trial balance. 4. The trial balance is used for internal purposes only and provides a check on the equality of the debits and
View Full Document