COMM-3016EL Chapter Notes - Chapter 3: Accounting Information System, Risk-Free Interest Rate, Cash Flow

• School: Laurentian
• Department: Commerce and Administration
• Course: COMM-3016EL
• Professor: Jo- Anne Ryan

Document Summary

Chapter 3 the accou(cid:374)ti(cid:374)g i(cid:374)for(cid:373)atio(cid:374) syste(cid:373) a(cid:374)d measure(cid:373)e(cid:374)t issues. Accounting information system the system for collecting and processing transaction data to make financial information available to interested parties. The act of entering an amount on the left side of an account is called debiting the account, while making an entry on the right side is referred to as crediting the account. Under the double-entry accounting system, the two-sided effect of each transaction is recorded in the appropriate accounts every transaction is recorded with total debits equal to total credits. All the asset and expense accounts are increased on the left (debit side) and decreased on the right (credit side) All liability and revenue accounts are increased on the right (credit side) and decreased on the left (debit side) Shareholders" equity accounts, such as common shares and retained earnings, are increased on the credit side, whereas dividends are increased on the debit side (they cause a decrease in retained earnings)