Documente Academic
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Documente Cultură
DEBIT CREDIT
DEBIT CREDIT
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Expanded Accounting Equation
“ The basic accounting equation can be
expanded to include all five financial categories
indicating what has been received and given.”
DEBITS CREDITS
=
Liabilities
Assets
Owner’s Equity
Net
Income
Revenues
Expenses
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King Ranch
Chart of Accounts
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Journal, Ledger, Trial Balance
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Recording and Posting an Entry
General Journal Page 1
Post.
Date Description Ref. Debit Credit
12/1 Prepaid Insurance 2,400
Cash 2,400
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Recording and Posting an Entry
General Journal Page 1
Post.
Date Description Ref. Debit Credit
12/1 Prepaid Insurance 2,400
Cash 2,400
1 General Ledger
Account: Prepaid Insurance Account No. 15
Post. Balance
Date Item Ref. Debit Credit Debit Credit
TWO METHODS
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Cash Basis of Accounting
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Accrual Basis of Accounting
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The Matching Concept
Debits = Credits
Liabilities
Assets Owner’s
Equity
Net
Income
Expenses Revenues
matching
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Adjustments – Deferrals and Accruals
Expenses
Current Period Future Period
Deferrals Cash Paid Expense Recorded
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