Management and Organizational Studies 1023A/B Chapter Notes - Chapter 3: Double-Entry Bookkeeping System, Promissory Note, Retained Earnings

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Maria Ferraro

Document Summary

Accounting transactions def-occur when an asset, liabilities, or equity changes as a result of some economic event. System of collecting and processing transaction data and communicating financial information to decision makers is known as the accounting information system. Assets= liabilities+ shareholder equity ex transaction 1) investement by shareholders. Equal increase assets and equity transaction 2) issue of not payable. They now have 15,000 in assets but have 5,000 in liabilities and. Deducted 5,000 from cash but spent that on equipment which is an asset. Transaction 4)receipt in cash in advance from customers. The amount that company receives goes under cash but also unearned revenues as they haven"t received the payment yet. Many transactions happen but the point is you must balance assets to liabilities and shareholder equity. Summary of transactions one chart that shows all entries. An individual accounting record of an increase or decrease in specific asset, liability or shareholder"s equity item.