Chapter 3 Lecture Notes

 How to analyze accounting transactions – cheat sheet in d2l near textbook tab
 Transaction only counts if either cash is paid or good/service is delivered

ICDQ1 – around pg 30 of textbook

1. Contribute Capital, Cash increase and owners capital increase
2. They will charge later, no entry. No transactions has happened yet so don’t need to enter
it
3. Cash increase, Loans payable increase by 4000
4. Supplies increase, accounts payable increase by 678
5. Cash decrease, rent expense increases by 1700
6. Cash decrease, Prepaid insurance (asset) goes up, every month prepaid insurance expense
goes up
7. Supplies increase, Accounts payable increase
8. Accounts receivable goes up, Service Revenue increases, Cash increases
9. Supplies goes down, supplies expense goes up
10. Prepaid Insurance goes down, Insurance expense goes up
11. And 12 . Cash goes down, Interest Expense goes up, Bank Fees go up (separate from
interest charges)
13.. office supplies go down, supplies exp go up
14. Cash goes down, accounts payable goes down

ICDQ 3-3
1. Cash goes up, Owners capital up
2. Loan payable goes up, Cash goes up
3. Acoounts payable go up, Business License asset goes up
4. N/a no entry, no bank charges yet
5. Account payables goes up, Supplies Assets goes up
6. Cash goes down, Prepaid Insurance goes up
7. Accounts payable goes up, Prepaid Advertising goes up
8. N/A no entry
9. Prepaid Advertising goes down, Advertising Expense goes up
10. Revenue goes up
11. Prepaid Supplies goes down, Supplies expense goes up
12. Cash goes down, Bank fee expense goes up
13. Cash goes down by 95, transportation expenses goes up by 95
14. Cash goes down by 46, Phone Expense goes up by 46
15. Prepaid Insurance goes down by a 12th, Insurance Expense goes up by a 12th
16. Cash goes down, accounts payable goes down

ICDQ 3-4
1. Cash goes up, Owner’s capital goes up