MGCR 211 Lecture Notes - Lecture 4: Accounts Payable, Retained Earnings, Executory Contract
19 Sep 2016
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Document Summary
A chart of accounts is a listing of the names of the accounts that a company has identified and made available for recording transactions. The balance brought forward at the beginning of an accounting period: the amount of funds in a company"s account at the beginning of a new financial o period. It is the first item in the accounts, either when a company is first starting up its accounts or after a year end. Any event that both affects the financial position of the business entity and can be reliably recorded. Some economic events involve an exchange of promises only (executory contracts) and they are not accounting transactions. Ex: signing a lease, customer orders, hiring an employee. The impact of transactions on the accounting equation. Ex: 1000 shares of common stock for 40,000, received in cash. This is an increase in cash and also an increase in shareholders equity.
