ACC 210 Lecture 3: Chapter 3 Lecture Notes

• School: Stony Brook University
• Department: Accounting
• Course: ACC 210
• Professor: Christie Comunale

Document Summary

Preview of chapter: cycle itself, recording process, trial balance. Accounting information system: collecting and, processing transaction data and, communicating financial information to decision makers, most business use computerized accounting (edp) systems. Question: are the following events recorded in accounting records? (is the financial position su(cid:272)h as: assets, lia(cid:271)ilities, o(cid:396) sto(cid:272)kholde(cid:396)s" e(cid:395)uit(cid:455) of the (cid:272)o(cid:373)pa(cid:374)(cid:455) (cid:272)ha(cid:374)ged?) Event 1: on oct 1st, cash of 10k is invested in sierra corporation by investors in exchange for. Cash (assets) goes up -> common stock goes up -> se goes up. Event 2: on oct 1st, sierra borrowed 5k from castle bank by signing a 3-month, 12%, 5k note payable. Cash (assets; new cash flow) goes up -> liabilities goes up (notes payable) Event 3: sierra purchased equipment by paying 5k cash to superior equipment sales co. Equipment goes up (asset) -> cash goes down (asset) = still in balance. Event 4: sierra received a 1. 2k cash advance from a client.