Understanding and Analyzing Business Transactions

An accounting system must record all business transactions to ensure complete and reliable information when the financial statements are prepared. Before going to the recording process, let us understand business transactions first.

Lesson 2

Rules of Debit and Credit: Left versus Right

Debit means left and credit means right. Learn how to use debit and credit in this lesson.

Lesson 3

The Chart of Accounts – Example and Explanation

Before recording transactions into the journal, we should first know what accounts to use. This is where a chart of accounts comes in handy.

Lesson 4

Journal Entries: Recording Business Transactions

In double-entry accounting, business transactions are recorded in the journal through journal entries. The journal, also known as Books of Original Entry, keeps records of transactions in chronological order.

Lesson 5

More Journal Entry Examples

We provide some more sample transactions and their journal entries to help you get used to the recording process...

Lesson 6

Posting to the Accounting Ledger

In accounting, a ledger refers to a book that consists of all accounts used by a company, the debits and credits to each account, and the resulting balances. The ledger is also known as Books of Final Entry.

Lesson 7

Trial Balance: Testing the Equality of Debits and Credits

A trial balance is a report that summarizes the balances of the ledger accounts after the posting process. A trial balance is prepared primarily to test the equality between total debits and total credits.

Lesson 8

Correcting Entries for Errors Detected

When an error is discovered in the accounting records, it should be corrected immediately to prevent the processing of wrong data which will result to unreliable financial statements. This is done through correcting entries.

Chapter Contents

Chapter IV of the Accounting 101: Basics course deals with analyzing and recording (journalizing) business transactions, and classifying (posting) the accounting records.

Aside step-by-step tutorials in journalizing transactions and posting to the ledger, this chapter also tackles additional basic accounting concepts such as the rules of debit and credit, chart of accounts, trial balance preparation, and correcting entries.

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Analyzing, Recording, and Classifying

APA format

Analyzing, Recording, and Classifying (2022). Accountingverse.
https://www.accountingverse.com/accounting-basics/analyzing-recording-classifying.html

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The Financial Statements

Course Outline