Transactions Flashcards
Book of prime entry
The records in which transactions are initially recorded
Cash book
The book of prime entry used to record money received and paid out by the business
Credit
The credit side of a ledger account is the right hand side
Debit
The debut side of a ledger account is the left hand side
Double entry bookkeeping
A system of accounting where two effects of eachtransactions are recorded
Drawings
The money or goods that the owner takes out of the business
Dual effect
Every transaction a business undertakes has two effects on the business (a befit and a credit)
General ledger
A collection of ledger accounts, where the double entry takes place for all the transactions of the business
Journal
The book of prime entry for non-standard transactions
Ledger accounts (or t accounts)
The accounts in which each transaction is recorded
Purchases
Purchases either of materials that are to be made into goods for resale or purchases of goods that are to be resold to customers
Purchases day book
This day book lists the invoices received from credit suppliers
Sales day book
This book lists the sales invoices sent out by the business to credit customers
Sales tax
A consumer tax imposed by the government on the sale of certain goods and services
Trial balance
A list of the closing balances on each of the general ledger accounts with one column for all the items with debit balances and another column for all the items with credit balances; total debits should equal total credits
