4. Record Keeping Flashcards
1
Q
General Ledger
A
A place where a business stores a complete record of all of its financial transactions and accounts. Like a filling system.
2
Q
Balance
A
Total at a point in time e.g. opening balance— total cash balance at the beginning
3
Q
Trial Balance
A
An accounting report showing the closing balances of all general ledger accounts at a point in time.
4
Q
What is the accounting cycle?
A
Transaction —Identifying and measuring— Recording— Classifying and summarising— Reporting
5
Q
What are the characteristics of the transaction?
A
- exchange of items of economic value
- involves a party external to business
- evidence (documentation) exists
- measurable in monetary units.
6
Q
What are the 9 steps in accounting cycle?
A
source documents, journal entries, post to ledgers, trial balance, adjusting journal entries, adjusting trial balance, closing journal entries, post-closing trial balance, prepare financial statements
