Beruflich Dokumente
Kultur Dokumente
Processing
Accounting
3 Information
Internal events:
Event occurs entirely
within the entity
LO1
Source Documents
Purchase Sales
Invoice Invoice
Evidence needed
in an accounting
Cash
system to record
transactions Checks
Register
Tape
LO2
Issue Capital Stock for Cash
1/2010 Transactions for Glengarry Health Club
LO3
Purchase of Property in
Exchange for Note Payable
+ – – + – +
REVENUES
Revenues increase
–
Dr. Cr.
+
retained earnings
(part of owners’ equity)
Link Between Expenses and
Dividends and Retained Earnings
RETAINED
EARNINGS
Retained earnings is
decreased with debits DR. CR.
– +
Expenses and dividends
decrease retained earnings EXPENSES AND
DIVIDENDS
Use debits to record(increase) DR. CR.
expenses and dividends
+ –
Normal Account Balances
Debit Credit
Assets Liabilities
Expenses Stockholders’ Equity
Dividends Revenues
94,000 11,000
The Journal: Chronological
Record of Transactions
LO6
Posting from Journal
Transactions are
entered in: And then posted to:
Journal
(via journal entries):
Ledger Accounts
• Cash
Dr. Cr.
• Capital Stock
Cash 100,000
Capital Stock 100,000
To record the issuance of 10,000 shares
Glengarry Health Club
Trial Balance
January 31, 2010 Debits Credits
Cash $ 94,000
Accounts Receivable 11,000
Equipment 20,000
Building 150,000
Land 50,000
Accounts Payable $ 20,000
Notes Payable 200,000
Capital Stock 100,000
Membership Revenue 15,000
Court Fee Revenue 5,000
Wage Expense 10,000
Utility Expense 3,000
Dividends 2,000
Totals
$340,000 $340,000
LO7
End of Chapter 3