MGT120H5 Chapter Notes - Chapter 2: Deferral, Accounts Payable, Retained Earnings

• School: UTM
• Department: Management
• Course: MGT120H5
• Professor: Catherine Seguin

Document Summary

Transaction any event that has a financial impact on a business and that can be reliably measured. For every transaction, every side of the equation should balance out. Double entry system method of accounting that all businesses use where every transaction has two sides. Chart of accounts lists the name of every account and its unique account numbers but does not provide account balance. The t account has two sides, debit and credit. Increases and decreases in the accounts: rules of credit and. Assets = liabilities + oe (share capital + opening retained earnings dividends + net income) Record transactions in the journal and post in ledger: Journal chronological record that transactions are recorded in. Determine which accounts increase and which decrease. Record transaction to journal with brief explanation. The journal does not show the balances of accounts. We must transfer these posts to the ledger by posting.