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Please relate the definitions in Part III to the schematic below. Note the accounting equation has been rewritten to better explain debits and credits. ASSETS. = rewriting the accounting equation it should be noted that. Assets are Free Quick Notes Books has your free copies of accounting, economics, math, and statistics.
The Accounting Equation. J. E. Cairnes School of Business and Economics. NUI Galway. J. E. Cairnes School of Business & Economics. ASSETS. Definition: 'an asset is owned by its owner and is worth something to its owner'. 'any right which is of economic value to its owner'. (Gillespie & Lewis, Principles of Financial
1. Chapter 2: The Accounting Elements. Topic Outline: 1. Cash vs Credit Transactions. 2. Accounting Elements. • Assets. • Liabilities. • Owner's equity. 3. The Accounting Equation. • basic accounting equation. • expanded accounting equation. 4. Measurement of Financial Performance
Introduction to Accounting I. Lecture Notes. Page 2 of 20. THE ACCOUNTING EQUATION (Study the examples in the book, p. 5). Assets = Liabilities + Owner's Equity. This equation must always balance! BUSINESS TRANSACTIONS AND THE ACCOUNTING EQUATION. A transaction is any activity that changes the value of
LEARNING OBJECTIVES. Careful study of this chapter should enable you to: LO1 Define the accounting elements. LO2 Construct the accounting equation. LO3 Analyze business transactions. LO4 Show The most common liabilities are accounts payable and notes payable. An account payable is an unwritten promise to
From the accounting equation, we see that the amount of assets must equal the combined amount of liabilities plus owner's (or stockholders') equity. Liabilities are a company's obligations—amounts the company owes. Examples of liabilities include notes or loans payable, accounts payable, salaries and wages payable,
purpose of these notes is to provide a tangible collection of the visuals used in the videos with comments highlighting the more important aspects covered. An introduction to the accounting equation in the context of building a financial model. This series introduces the financial statements in the context of a financial model.
Is our NET WORTH. This means if we sold all of our assets and used the cash to pay all of our debts (liabilities), what is left over is what our company is worth. The Equity account is composed of 4 accounts so when we expand the accounting equation it will now look like this: Assets. = Liabilities. + Capital + Revenue
The Accounting Equation & The last thing we need to know is how transactions affect the basic accounting equation. . statement, a retained earnings statement, and a balance sheet for February. No. ASSETS. LIABILITIES. STOCKHOLDERS' EQUITY. Cash. Accounts. Receivable. Supplies Equipment. Notes. Payable.
Kitten who is a very shrewd sales woman has managed to sell all her stock of makeup to a television company for ?8,000 in cash. This means a profit of ?3,000 has been made (?8,000 –. 5,000). This profit belongs to the owner therefore is part of the capital. This is how the above transactions effect the accounting equation.
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