Question
Make a comment at least 120 words An account is an individual accounting record of increases and decreases in a specific asset, liability, or stockholders
Make a comment at least 120 words
"An account is an individual accounting record of increases and decreases in a specific asset, liability, or stockholders equity item. An account consists of 3 parts; one a title of the account, two a left or debt side, and three a right or a credit side. It is called a T-account because the alignment of the parts of the account resemble the letter T.
The basic steps in the recording process is:
1), analyze each transaction in terms of its effect on the accounts. Each transactions before writing it in the journal are analyzed according to its effect on the account. The transactions are entered in the ledger first and then their effect is analyzed in terms of the effect on the accounts.
2) a source document, such as a sales slip, a check, a bill, or cash register tape provides evidence of the transaction. The source document is a record of information that describes the financial information in terms of their internal purpose of business.
3) Enter the transaction information in the journal. It is recorded in a journal and then the information in the journals is posted into the accounts which are stored in a general journal.
4) Transfer the journal information to the appropriate accounts in the ledger or the books of accounts. After the journal entries are made, the next step would be to post the journal entries into the ledger. Posting refers to the process of transferring entries in the journal in to the accounts in the ledger. "
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