In this area, we will discuss the significance of the accounting equation, the rules of debit and credit, and the steps in the accounting cycle. We will talk about recording of transactions, normal balances, and the creation of the trial balance.

Let's begin by asking this question: What is the role of the accounting equation in the analysis of business transactions?

What does cash basis accounting mean?

Let's examine accrual accounting. Why not just use the simple cash basis? What are some of the benefits of using accrual accounting?