C1
Analyzing & Recording Process
Exchanges of economic consideration between two parties.
External Transactions occur between the organization and an outside party.
Assets
=
Liabilities
+
+
Equity
+
Common Stock
–
Dividends
–
Expenses
Revenues
2-15
C4
Ledger and Chart of Accounts
（会计科目表）
The ledger is a collection of all accounts for an information system. A company’s size and diversity of operations affect the number of accounts needed.

C3
Equity Accounts
Retained Earnings
Capital Surplus/ Reserve, Net Profit
Common Stock/
Owner, Capital
Initial & further investments
Dividends/
Equity Accounts
Accounts Receivable
Buildings
Asset Accounts
Notes Receivable
Equipment Supplies
Prepaid Accounts
2-8
Asset Accounts

Cash account:

Monetary Capital
Money and any medium of exchange accepted by a bank for deposit Coins, checks, money orders, checking account balance Held by a seller and refer to promises of payment from customers to sellers A company needs a separate record for each customer Written promise of another entity to pay a definite sum of money on a specified future date to the holder of notes
The chart of accounts is a list of all accounts and includes an identifying number for each account.
Ext.2.4 p. 32
101 106 126 128 167 201 236 307 318 Cash Accounts receivable Supplies Prepaid insurance Equipment Accounts payable Unearned revenue Common stock Retained Earnings 319 403 406 622 637 640 652 690 Dividends Consulting Revenues Rental revenue Salaries expense Insurance expense Rent expense Supplies expense Utilities expense

When FSs prepared, prepaid accounts adjusted:


All expired and used, recorded as regular expenses; All unexpired and used, recorded as assets.
Asset Accounts
（账户）
An account is a record of increases and decreases in a specific asset, liability, equity, revenue, or expense item.
总分类账 -The general ledger is a record containing all accounts used by the company. 分类帐– Ledger
=
Liability Liability Liability Accounts Accounts Accounts
+
Equity Equity Equity Accounts Accounts Accounts
2-7
C3
Asset Accounts
——at a minimum level
Cash
Land
To debit credit the account credit balance
Account Balance
日记账 - Journal, gives a
complete record of each transaction in one place.
2-6
C3
The Account and its Analysis
Assets Assets Asset Accounts Accounts Accounts
Trial Balance
• Source documents • Account & analysis • Types of accounts
• General ledger
• Double-entry • Journalizing & Posting
• Trial balance preparation • Search for & correction of errors • Trial balance use

Supplies: often for shorterm use, grouped by purpose

Office supplies –stationery, paper, toner, pens Store supplies –packaging materials, bags, boxes
Chapter 2
Analyzing and Recording Transactions
Outline of Chapter 2
Analyzing and Recording Transactions
Analyzing & Recording Process
Analyzing & Processing Transactions

Buildings: stores, offices, warehouses, factories Land: separately recorded from Buildings
C3
Liability Accounts
Accounts Payable
Notes Payable
应计负债 Accrued Liabilities
Owner’s withdrawals
Not expenses!
Revenues
Sales, Commissions, Rents, Interests
Expenses
Costs of Sales, Salaries, Advertising, Rents, Interests
2-14
C3
The Account and its Analysis
Liability Accounts
Unearned Revenue 未赚取收入 OR 预收账款
2-12
Liability Accounts

Accounts payable: oral or implied promise

Office supplies –stationery, paper, toner, pens Store supplies –packaging materials, bags, boxes Short-tem Notes payable Long-tem Notes payable A liability, settled in future when company deliver the products or services. E.g. magazine subscriptions, season tickets sales Earned portion transferred to Revenue when products delivered E.g. wages payable, taxes payable, interest payable
Record relevant transactions and events in a journal
原始凭证
日记账
Prepare and analyze the trial balance 试算平衡
Post journal information to ledger accounts
分 类 账
2-4
2-16
C5
Debits and Credits
借方与贷方
A T-account represents a ledger account and is a tool used to understand the effects of one or more transactions.