Business Administration 2257 Study Guide - Midterm Guide: Accounts Payable, Income Statement, Bank Reconciliation
31 Mar 2018
School
Department
Professor
Document Summary
5 basic types of accounts liabilities: assets, equity, revenue, expenses assets, liabilities & equity are the statement of financial position accounts revenues and expenses are the income statement accounts. Types of accounts assets economic resources owned by a business that are expected to benefit future operations car, computer, building liabilities. The fundamental accounting equation assets = liabilities + shareholders" equity. The rule of debit and credit for all transactions: total debits = total credits. Disadvantages increased government regulations taxed as a separate legal entity. Partnerships and proprietorships advantages: easier to form and dissolve, not taxed as separate entities pay personal income tax. Disadvantages: unlimited liability, difficulty obtaining financing. C1a: debit revenue accounts with credit balances, credit income summary. C1b: credit revenue accounts with debit balances, debit income summary. C2a: credit expense accounts with debit balances, debit income summary. C2b: debit expense accounts with credit balances, credit income summary. C3: subtotal income summary, calculate and record taxes.
