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Basic Accounting Transaction with EXAMPLES
Accounting Process for Transaction Analysis - WorldWide Webster
On the accounting process, you'll recall from class the accounting process has three major steps.
Three major steps
- step one is transaction analysis
- step two records the transactions using the debit credit framework.
- step three summarizes the transactions by posting them to T accounts which we can use to create the balance sheet.
so let's begin with our example you see here we've got Shelly Webster who started a web design.
business on December the 1st 2015 and we've given you some transactions that happened during December Shelly's business you can see here that she had a shareholder invest in her business she also borrowed some money from the bank we can see run her business she bought some equipment in C and in D she purchased and received.
some supplies are on credit so we're going to have to deal with the credit aspect of it you can see an e throughout December she also signed a contract to do some web design for a customer but she's not going to do the website development until next month which is January 2016 so we'll have to talk about a and C how we want to handle that when we do our transaction analysis again we know she had some depth.
so she's paying them down an F some of them she buys some more supplies and then she bought a little more equipment okay which she paid in cash and put someone into account and then she also ordered a server so that she can house her data and that order that she placed indicated that the server would be received next month.
Business Transaction
learning one more accounting term and the term for today is business transaction before we have a look at the meaning of this term let's try and understand this with the help of an example.
this is John a shopkeeper and he sells burgers fries and a coal drink he's a seller of goods this is Tina she's a customer and she's a buyer of goods she wants to buy these burgers fries and a cold drink for money so their is a seller and there is a buyer tina wants to buy this burger fries and cold ring and when she is going to buy this from Jon she is going to give him money.
so in this transaction, Tina is going to get this stuff and in return, she is going to pay money to join so there's a seller there's a buyer there is a product that is sold and in return for this the seller is going to receive money from the buyer so when john provides tina with this stuff he is going to receive money from tina in return.
so that is what is a transaction where the buyer and seller exchange goods or services and in return, the seller receives money the business transaction is a financial transaction entered by two parties that involve the transfer or exchange of goods or services in exchange for money
Business Transactions and Accounting Equation
will learn about how businesses conduct transactions, how these transactions affect the financial position of the business, and the concept of the accounting equation.
let's begin by understanding what is a transaction
- A transaction means in a business a transaction takes place by exchanging goods or services for money.
- In accounting, a transaction is defined as a completed sale or exchange of goods or services.
- In exchange, there are at least two equal actions something is given and something is received. for example, buying a computer borrowing money for the business making a sale receiving money paying salaries, etc are all business transactions that involve money and will need to be recorded.
FAQs Related Questions & Answers :)
Introduction to Accounting. | What is accounting?
Accounting is a useful way of recording and summarizing financial information. Businesses use accounting to keep their financial information organized which helps them in making sense of their financial data and also keeps them compliant with financial regulations. Learn More.
A House An Asset Or A Liability? [ Finally Explained ]
Is a house an asset or a liability? That is one of the biggest questions many people have when they think about buying a house.
It is important to understand real estate in terms of assets and liabilities and the different ways you can buy a house so you will no longer wonder Should I buy a house? Learn more.
What is The Accounting Equation?
It is a basic but also a very important accounting principle, so what is the accounting equation? LEARN MORE.
so what is the accounting equation? I’m Thomas Harwood and Welcome to The Accounting Student, where we create free and short videos Learn more.
What is Revenue Expenditure? | ACCOUNTING
A company will have different types of expenditure, how will revenue expenditure be treated in the accounts?
what is revenue expenditure? Usually, a business will have cash coming in, which can be known as income, and cash going out which can be referred to as expenditure. Learn more.
Accounting Equation
The accounting equation is one of the fundamental elements of double-entry accounting and the foundation for all of the concepts learned in introductory accounting. In this short video, you will learn what the equation is and what each part represents.
This video was created about the Utah State CTE standards for the Accounting I High School course. Specifically, this video prepares students to complete Strand 2, Standard 2: Demonstrate an understanding of the fundamental accounting equation. Learn more.
Accounting Process for Transaction Analysis - WorldWide Webster
On the accounting process, you'll recall from class the accounting process has three major steps. Learn more.
Journal Definition - What is a Journal?
The Journal definition includes a breakdown of areas in the definition. Analyzing the definition of key terms often provides more insight into concepts.
The term journal can be defined as a Record in which transactions are entered before they are posted to ledger accounts; also called the book or original journal. Learn more.
What is a General Ledger? (Recording Nonprofit Transactions)
What is a general ledger? A general ledger is a list of transactions by account. In this lesson, you’ll learn what transactions are, how and when to record them, and how they impact your nonprofit's accounting system. Learn more.
Depreciation explained
What is depreciation? How to calculate depreciation? Depreciation, amortization, and CapEx tutorial.
Overview of depreciation accounting (concept and application), and related topics such as accumulated depreciation, book value, residual value, historical cost, fixed assets, amortization, useful life, capital expenditures (CapEx), and capitalization. Intended for students and business people at both entry and advanced levels. Learn more.
The TRIAL BALANCE Explained (Full Example!)
Learn how to prepare a Trial Balance using T Accounts and Journal Entries. The Trial Balance is made easy in this episode of Accounting Stuff - Accounting Basics for Beginners Lesson 5 - you will learn: Learn more.
Introduction to Accounting. | What is accounting?
Accounting is a useful way of recording and summarizing financial information. Businesses use accounting to keep their financial information organized which helps them in making sense of their financial data and also keeps them compliant with financial regulations. Learn More.
A House An Asset Or A Liability? [ Finally Explained ]
Is a house an asset or a liability? That is one of the biggest questions many people have when they think about buying a house.
It is important to understand real estate in terms of assets and liabilities and the different ways you can buy a house so you will no longer wonder Should I buy a house? Learn more.
What is The Accounting Equation?
It is a basic but also a very important accounting principle, so what is the accounting equation? LEARN MORE.
so what is the accounting equation? I’m Thomas Harwood and Welcome to The Accounting Student, where we create free and short videos Learn more.
What is Revenue Expenditure? | ACCOUNTING
A company will have different types of expenditure, how will revenue expenditure be treated in the accounts?
what is revenue expenditure? Usually, a business will have cash coming in, which can be known as income, and cash going out which can be referred to as expenditure. Learn more.
Accounting Equation
The accounting equation is one of the fundamental elements of double-entry accounting and the foundation for all of the concepts learned in introductory accounting. In this short video, you will learn what the equation is and what each part represents.
This video was created about the Utah State CTE standards for the Accounting I High School course. Specifically, this video prepares students to complete Strand 2, Standard 2: Demonstrate an understanding of the fundamental accounting equation. Learn more.
Accounting Process for Transaction Analysis - WorldWide Webster
On the accounting process, you'll recall from class the accounting process has three major steps. Learn more.
Journal Definition - What is a Journal?
The Journal definition includes a breakdown of areas in the definition. Analyzing the definition of key terms often provides more insight into concepts.
The term journal can be defined as a Record in which transactions are entered before they are posted to ledger accounts; also called the book or original journal. Learn more.
What is a General Ledger? (Recording Nonprofit Transactions)
What is a general ledger? A general ledger is a list of transactions by account. In this lesson, you’ll learn what transactions are, how and when to record them, and how they impact your nonprofit's accounting system. Learn more.
Depreciation explained
What is depreciation? How to calculate depreciation? Depreciation, amortization, and CapEx tutorial.
Overview of depreciation accounting (concept and application), and related topics such as accumulated depreciation, book value, residual value, historical cost, fixed assets, amortization, useful life, capital expenditures (CapEx), and capitalization. Intended for students and business people at both entry and advanced levels. Learn more.
The TRIAL BALANCE Explained (Full Example!)
Learn how to prepare a Trial Balance using T Accounts and Journal Entries. The Trial Balance is made easy in this episode of Accounting Stuff - Accounting Basics for Beginners Lesson 5 - you will learn: Learn more.
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