Chapter 2 Terms

Question 1

Account

Answer 1

A record of increases and decreases in specific asset, liability, or owner’s equity items

Question 2

Chart of Accounts

Answer 2

A list of accounts and the account numbers that identify their location in the ledger

Question 3

Compound Entry

Answer 3

A journal entry that involves three or more accounts

Question 4

Credit

Answer 4

The right side of an account

Question 5

Debit

Answer 5

The left side of an account

Question 6

Double-Entry System

Answer 6

A system that records in appropriate accounts the dual effect of each transaction

Question 7

General Journal

Answer 7

The most basic form of journal

Question 8

General Ledger

Answer 8

A ledger that contains all asset, liability, and owner’s equity accounts

Question 9

Journal

Answer 9

An accounting record in which transactions are initially recorded in chronological order

Question 10

Journalizing

Answer 10

The entering of transaction date in the journal

Question 11

Ledger

Answer 11

The entire group of accounts maintained by a company

Question 12

Normal Balance

Answer 12

An account balance on the side where an increase in the account is recorded

Question 13

Posting

Answer 13

The procedure of transferring journal entries to the ledger accounts

Question 14

Simple Entry

Answer 14

A journal entry the involves only two accounts

Question 15

T-Account

Answer 15

The basic form of an account, consisting of (1) a title, (2) a left or debit side, and (3) a right or credit side

Question 16

Three-Column Form of Account

Answer 16

A form with columns for debit, credit, and balance amounts in an account

Question 17

Trial Balance

Answer 17

A list of accounts and their balances at a given time