This chapter focuses on the accounting process. We describe transactions and source documents as inputs for analysis. We explain the analysis and recording of transactions. The accounting equation, T-account, general ledger, trial balance, and debits and credits are applied tools in the accounting process.
Conceptual |
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Explain the steps in processing transactions. |
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Describe source documents and their purpose. |
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Describe an account and its use in recording transactions. |
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Describe a ledger and a chart of accounts. |
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Define debits and credits and explain their role in double-entry accounting. |
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Analytical |
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Analyze the impact of transactions on accounts and financial statements. |
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Compute the debt ratio and describe its use in analyzing financial condition. |
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Procedural |
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Record transactions in a journal and post entries to a ledger. |
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Prepare and explain the use of a trial balance. |
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Prepare financial statements from business transactions. |