Using T Accounts
This is an accounting device used to analyze transactions.
T - Account
A list of accounts used by a business is called a…
Chart of Accounts
Amounts to be received in the future due to the sale of goods or services is called…
Accounts Receivable
An amount recorded on the left side of a T-Account is called a…
Debit
Amounts to be paid in the future for goods or services already acquired are called…
Accounts Payable
When a sale is made it will _____ owner’s equity.
increase
An amount recorded on the right side of a T-Account is called a…
Credit
When analyzing a business transaction the first question you should as is…
Which accounts are affected?
When an expense is paid it will ____ owner's equity.
decrease
The side of an account that is increased is called the…
Normal Balance
In the following transaction, what two accounts are being affected and what type of account are they (Asset, Liability, Owner's Equity)?
Paid cash on account to Canyon Office Supplies, $100.00
Accounts Payable—Canyon Office Supplies > liability account.
Cash > asset account.
In the following transaction, what two accounts are being affected and how are they classified (asset, liability, owner's equity)?
Paid cash for communications bill for cell phone and Internet service, $80.00
Communications Expense > owner’s equity.
Cash > asset account.
Liability accounts are on the right side of the accounting equation and therefore have a normal balance of a ___.
Credit
When you decrease an account balance, record the decrease on the side ____ the normal balance side of the account.
opposite
In the following transaction, what two accounts are being affected and how are the accounts being changed?
Michael Delgado withdrew equity in the form of cash, $350.00
Michael Delgado, Drawing > increased with a debit
Cash > decreased with a credit