ACCT 217 Lecture Notes - Lecture 5: General Ledger, Accounting Information System, Accounting Equation
26 Mar 2017
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Document Summary
The first step in the process is to analyze the business transaction. A business transaction occurs when the assets, liabilities or shareholders" equity items change as a result of an economic event. Regardless of the industry, the company, the location, all accounting is made up of transactions: transactions are economic events that must be recorded in the f/s. Ropafadzo chinake: the industry the business operates in, the size of the company, the amount of data. The 2nd step of the process in journalizing the accounting transactions. Transactions are recorded in chronological order (by date) in a journal before moving to step 3 of the accounting cycle. Debit left side of the t account & credit right side of the t account. Debits and credits are merely directional signals used in the recording process to describe where entries are made in the accounts. If the greater sum is on the left, the account has a debit balance.
