SHOW ME THE PAPERWORK!
This provides evidence that a business transaction actually occurred.
What is a source document?
The left side of a T-account is called this.
What is a debit?
The accounting record where transactions are first formally recorded.
What is the journal?
The company purchased $800 of landscaping supplies on credit.
Debit: Supplies $800
Credit: Accounts Payable $800
A list of all ledger accounts and their balances at a particular point in time.
What is a trial balance?
A customer buys $800 of merchandise on account. The document sent to the customer showing what they owe is generally called this.
What is a sales invoice?
The right side of a T-account is called this.
What is a credit?
The process of transferring information from the journal to the ledger is called this.
What is posting?
The company provided $2,200 of landscaping services on credit to a customer.
Debit: Accounts Receivable
Credit: Sales/Revenue
This financial statement reports a company's assets, liabilities, and equity at a specific point in time.
What is the balance sheet?
Why are source documents important to the accounting process?
hey provide evidence and information used to record transactions.
A debit increases which type of account?
A. Liability
B. Revenue
C. Asset
D. Equity
C. Asset
A business pays $500 cash for rent. What account is debited?
What is Rent Expense?
The company collected $1,500 cash from the customer as partial payment of service provided on Feb 3.
Debit: Cash
Credit: Accounts Receivable
This financial statement reports revenues and expenses for a period of time.
What is the income statement?
A company receives a monthly document from its bank showing deposits, withdrawals, and the account balance. What source document is this?
What is a bank statement?
A credit increases these three major types of accounts.
Answer: Liabilities, equity, and revenues.
A company pays $700 cash for an expense.
Does this transaction:
A. Increase assets and increase equity
B. Decrease assets and decrease equity
C. Increase liabilities and decrease assets
D. Increase assets and decrease liabilities
B. Decrease assets and decrease equity
The company paid $500 cash toward the payable for the landscaping supplies previously purchased on credit.
Debit - Accounts Payable
Credit - Cash
The trial balance has $62,000 in debits and $60,000 in credits.
What does this tell you?
There is an error somewhere in the accounting records because the trial balance does not balance.
Put these steps in the proper order:
Analyze the transaction → Record/journalize it → Post it to the ledger → Summarize the information
A business purchases equipment for $6,000 cash. Which account is debited and which is credited?
Debit Equipment $6,000
Credit Cash $6,000
The owner invests $10,000 cash into the business.
What happens to:
Cash increases $10,000.
Owner's equity increases $10,000.
The company paid $650 cash for February’s utilities bill.
Debit: Utilities Expense
Credit: Cash
What does a higher debt ratio generally indicate about a company's financial structure?
A greater proportion of the company's assets is financed by liabilities.