Session 3

Notes
 DO IT! 4 Tabular Analysis

5. The owner withdrew $1,000 cash for personal use.

Assets = Liabilities + Owner's Equity

Trans- Accounts Owner's Owner's
Cash + Equipment = + + + Rev. - Exp.
action Payable Capital Drawings
1. +25,000 +25,000

2. +7,000 +7,000

3. +8,000 +8,000

4. -850 -850

5. -1,000 -1,000

$31,150 + $7,000 = $7,000 + $25,000 + $1,000 + $8,000 - $850

$38,150 $38,150
LO 4
 Summary of Debit/Credit Rules

Relationship among the assets, liabilities and owner’s equity

of a business:
Illustration 2-11
Basic
Equation Assets = Liabilities + Owner’s Equity

Expanded
Equation
Debit/Credit
Effects

The equation must be in balance after every transaction. Total

Debits must equal total Credits.

LO 1
 Ledger

POSTING
Transferring
journal entries
to the ledger
accounts.

Illustration 2-17
Posting a journal
entry

LO 3
Chart of Accounts
Illustration 2-18

LO 3
Illustration 2-20
Purchase of office equipment LO 3
LEARNING
OBJECTIVE
4 Prepare a trial balance.

Illustration 2-31 LO 4