Chapter 4 Double Entry Accounting

Receipt – A business from giving written acknowledgement for cash received
Allocation – The process of assigning a cost, or a group of costs, to one or more cost objective, in reasonable and realistic proportion to the benefit provided or other equitable relationship.
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accounts receivable subsidiary ledger – A separate ledger that contains accounts for all charge customers; it is summarized in the Accounts Receivable controlling account in the general ledger.
percent change – (2008-2007)/(2007)
False – When a company receives cash from a customer for a prior sale the transaction increases the cash account balance and increases the accounts receivable balance
Donated capital – Безвозмездно полученный капитал
Accrual based accounting – Transactions are recorded in the period that they relate to which is not necessarily when cash changes hands (eg. accrued income/expenses, prepayments, income in advance, accounts payable/receivable.) The resulting current asset/liability is recorded
​If you are in a hurry to get an important letter out and are not sure about how to spell a word, the best thing to do is:
Employer owes taxes to the government – Liabilities
Memorandum – Form with a brief message
Statement of Retained Earnings – reveal changes in retained earnings over a period of time, from; net income/loss, dividend declared, effects of prior period adjustments
detective – one who finds out about criminals and catches them
Record set up by accountant to represent the proprietor"s ownership in the business – Capital
accounting – information system that measures business activities, process the information into reports, and communicates the results to decision makers
​If yоu аre in а hurry tо get аn impоrtant letter out and are not sure about how to spell a word, the best thing to do is:
The abbreviation for "debit" is – Dr
disposal (sale or abandonment) of plant assets Journal Entry Steps – -depreciation up to date:
Depreciation Expense
Accumulated Depreciation
-remove old asset at cost -> credit
-remove old asset's accumulated depreciation-> debit
-record cash received (if any) -> debit
-balance entry – debit(loss), credit(gain)
Accounts Receivable – from customers due to sales made on account, own the right to receive cash (asset because its a right) as long as its collectible

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