Chapter Six Flashcards
What are the elements of a financial statement
Assets, liability, capital, income and expenses
What is a general ledger ?
A collection of ledger accounts
What is general ledger / T accounts?
The account each transaction is recorded.. there will be a general ledger account for every transaction and for every type of asset and liability
Each ledger account has two sides, what are they?
The left side is the debit and the right side is credit, as well as a title at the top showing what it is eg bank
What must there be each transaction in the ledger account
A debit entry in one ledger account and an equal credit in another
What did a debit entry represent
Increase in expenses, assets, drawings, and a decrease liabilities, income, capital
What does a credit entry represent
An increase in liability, income, and capital and a decrease in expenses, assets and drawings
What does dead clic mean?
Debit expenses assset drawings increase
Credit liability income capitals decreaes
What would a supplier be if the business made a purchase on credit terms
Trade payables
What would a customer be if a sale was made on credit terms
Trade recieveables
In the general ledger, where are sales on credit posted?
Receivable ledger control account t
In the general ledger, where are purchases on credit posted
The payables ledger control account
What is a journal entry
The double entry
