ACC 100 Lecture Notes - Lecture 3: Current Asset, Retained Earnings, Accounts Receivable

• School: Ryerson University
• Department: Accounting
• Course: ACC 100
• Professor: Keith Whelan

Document Summary

External event: event involving interaction between an entity and its environment; i. e. payment of wages to an employee is an external event. Internal event: event occurring entirely within an entity; i. e. use of equipment is an internal event. Transaction: any event that is recognized in a financial statement. Source document: piece of paper used as evidence to record a transaction. Recap: in most transaction periods, the accounting equation is the most common form covered. Remember that it is assets = liabilities + shareholders" equity. In this example we will use a hypothetical corporation, glengarry health club, their business dealings and how it affects the accounting equation in their transactional period. The two founders of the company invest ,000 each into the business for 5,000 shares. This means they have ,000 in cash, which also translates to ,000 on capital stock.