BUSS1030 Lecture 2: Lecture 2Chapter 2 - Accounting Concepts

• School: University of Sydney
• Department: Business Studies
• Course: BUSS1030
• Professor: Olga Gouveros

Document Summary

Journal = book where all transactions are recorded. Ledger = the book which contains the detailed accounts for an organisation. Assets = a resource held by a business which has certain characteristics. Liabilities = claims of individuals and organisations, apart from the owner(s), that have arisen from past transactions or events, such as supplying goods or lending money to the business. Owners" equity = the claim of the owner(s) on the assets of the business. Double-entry accounting = formal system of recording using ledger accounts which reflect the dual aspect of financial transactions. Revenue = amounts received/to be received/inflows from sale of product/service. Expenses = amounts that have to be paid/later paid for costs incurred to earn revenue. Income = money/inflows from all methods/sources not just sale of product/service (revenue) Double entry bookkeeping means to record the dual effects of each business transaction. Every business transaction will affect at least two business accounts.