Professional Documents
Culture Documents
Chap 03
Chap 03
Journalizing, Posting,
and the Trial Balance
Chapter 3
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Learning Objective 1
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The Accounting Cycle
Accounting procedures are performed over a period
of time.
Procedures are performed in a definite order in the
accounting cycle.
The accounting period is a period of time covered by
the income statement.
Usually this is a twelve month period.
The accounting cycle has sequential steps to be
performed again each year.
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The Accounting Cycle
A sole proprietorship:
– has one owner
– begins with a monthly accounting cycle
– owner has a capital and withdrawals
account
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Business Organizations
Sole proprietorship
Partnerships
Corporations
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Recording Business Transactions
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Learning Unit 3-1
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Learning Unit 3-1
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Learning Unit 3-1
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Learning Unit 3-1
Journalizing
Debits are always recorded first.
Indent, then record the credit below the
debit.
A short explanation is included on the
second line.
Leave a space between journal entries.
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Learning Unit 3-1
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Learning Unit 3-1
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Learning Unit 3-1
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Learning Objective 2
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Learning Unit 3-2
Posting
All transactions are recorded in the journal, then
amounts are copied to the ledger accounts named on
the journal line.
Once the amounts are entered into the accounts, a
posting reference (PR) must be entered in the
journal.
New balances are computed in the running ledger
accounts.
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Learning Unit 3-2
Posting
Account: Cash Account: 1000
Balance
Date ref. debit credit debit credit
June 1 jr1 5,000 5,000
Journal Page 1
Date Account and
Explanation Post Ref. debit credit
June 1 Cash 1000 5,000
Clara J. Capital 3010 5,000
Initial investment
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Example
Journal Page 1
Date Account and
Explanation Post Ref. debit credit
July 3 Phone Expense 5040 155
Accounts Payable 2000 155
Paid phone bill
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Example
Journal Page 1
Date Account and
Explanation Post Ref. debit credit
July 6 Insurance Expense 5060 150
Cash 1000 150
Paid insurance bill
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Example
Journal Page 1
Date Account and
Explanation Post Ref. debit credit
July 8 Accounts Payable 2000 200
Cash 1000 200
Paid Accounts Payable
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Example
Journal Page 1
Date Account and
Explanation Post Ref. debit credit
July 8 Accounts Receivable 1020 850
Service Revenue 4000 850
Performed Services
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Learning Objective 3
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Learning Unit 3-3
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Learning Unit 3-3
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Learning Unit 3-3
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End of Chapter 3
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