Accounting Test 1
The side of an account that is increased.
A system in which each transaction has a dual effect on the accounting elements
normal balance for assets, expenses, & drawing accounts
normal balance for liability, owner's equity, and revenue accounts
to enter an amount on the left side of an account
to enter an amount on the right side of an account
What 3 questions should be asked in every transaction analysis
1. What happened?
2. What accounts are affected?
3. How is the account affected?
Assets=Liabilities + Owner's Equity
What are 3 commonly prepared financial statements?
Income Statement, Statement of owner's equity, & Balance Sheet
Owner's equity (+)
credit (rarely are there credits)
Owner's equity (-)
debit (same thing as a draw)
credit (very rare)
3 parts of T accounts
Account, debits, & credits
total of each side of T accounts
difference in footings in credits and debits
balance of account
where is balance of account written
side with larger footing
cash, accounts receivable, equipment, buildings, land
accounts payable, notes payable
owner's investment, revenue, & expense items
listing of all accounts and their balances,totaling dr. and cr. prooving they equal, & is prepared as an aid in preparing financial statements
What should be included in the heading of trial balance?
Name of Company, Type of document "Trial Balance", & date of trial balance
In what order are the accounts listed on a Trial Balnace?
Assets, Liabilities, Owner's Equity,Revenue accounts, & last the expense accounts
Wow do you know if you completed a Trial Balance correctly
Debits = Credits