Accounting
Chapter
3-1
The Accounting
Information System
Chapter
3-2
Financial Accounting, Fifth Edition
Study Objectives
1.
Analyze the effect of business transactions on the basic accounting equation.
2.
Explain what an account is and how it helps in the recording process. 3.
Define debits and credits and explain how they are used to record business transactions transactions. 4.
Identify the basic steps in the recording process.
5.
Explain what a journal is and how it helps in the recording process.
6.
Explain what a ledger is and how it helps in the recording process.
7.
Explain what posting is and how it helps in the recording process.
8.
Explain the purposes of a trial balance.
9.
Classify cash activities as operating, investing, or financing.
Chapter
3-3
The Accounting Information System
Accounting
Transactions
The Account
Steps in the
Recording
Process
Analyzing transactions Debits and credits The journal
Summary of transactions Debit and credit procedures
Chart of accounts Stockholders’ equity relationships
The ledger
The Recording
Process
Illustrated
Summary illustration of journalizing and posting The Trial
Balance
Limitations of a trial balance
Posting
Summary of debit/credit rules
Chapter
3-4
The Accounting Information System
The system of collecting and processing transaction data and communicating financial information to decision makers is known as the accounting information system.
Chapter
3-5
Accounting Transactions
Transactions are economic events that require recording in the financial statements.
May be external or internal.
Not all activities represent transactions transactions. Each transaction has a dual effect on the accounting equation.
Chapter
3-6
Accounting Transactions
Question: Are the following events recorded in the accounting records?
Discuss
Purchased a
computer.
3-1
The Accounting
Information System
Chapter
3-2
Financial Accounting, Fifth Edition
Study Objectives
1.
Analyze the effect of business transactions on the basic accounting equation.
2.
Explain what an account is and how it helps in the recording process. 3.
Define debits and credits and explain how they are used to record business transactions transactions. 4.
Identify the basic steps in the recording process.
5.
Explain what a journal is and how it helps in the recording process.
6.
Explain what a ledger is and how it helps in the recording process.
7.
Explain what posting is and how it helps in the recording process.
8.
Explain the purposes of a trial balance.
9.
Classify cash activities as operating, investing, or financing.
Chapter
3-3
The Accounting Information System
Accounting
Transactions
The Account
Steps in the
Recording
Process
Analyzing transactions Debits and credits The journal
Summary of transactions Debit and credit procedures
Chart of accounts Stockholders’ equity relationships
The ledger
The Recording
Process
Illustrated
Summary illustration of journalizing and posting The Trial
Balance
Limitations of a trial balance
Posting
Summary of debit/credit rules
Chapter
3-4
The Accounting Information System
The system of collecting and processing transaction data and communicating financial information to decision makers is known as the accounting information system.
Chapter
3-5
Accounting Transactions
Transactions are economic events that require recording in the financial statements.
May be external or internal.
Not all activities represent transactions transactions. Each transaction has a dual effect on the accounting equation.
Chapter
3-6
Accounting Transactions
Question: Are the following events recorded in the accounting records?
Discuss
Purchased a
computer.