Whether or not you shopped till you dropped, Black Friday is one of those events that gives you the excuse to spend money. Every transaction you made purchasing an item/product, the store will give a receipt. This receipt is a proof that you have made a purchase and it is a source of evidence. This is an example of a source document. A source document is any form of payment evidence. For example, telephone bills, electricity bills and retail receipts. Make sure to hang on to them because they might come in play when a transaction goes wrong!
Month: November 2015
Equation Analysis Sheet!
We learnt how to set up Equation Analysis Sheets this chapter. Every financial change that could change the financial position is called a business transaction. Every transaction is to be verified and neatly recorded on the equation analysis sheet. We would write the beginning transaction on the first row and then the transaction. After that row, it would be the new total. Repeated steps.
Excel!
We were introduced to Microsoft Excel, after many classes of hard work, and patience of making balance sheets by hand! On Excel, it is much easier to use and less troublesome, because if you made a mistake you simply press backspace, but when I made my balance sheets by hand, I would constantly be erasing and restarting again. On Excel, there are bunch of cells, (rectangles) and you would just punch in all the information and organize it into the format of a balance sheet!
Balance Sheets!!
(^Example of a Balance Sheet, made during class)
Balance sheets are really important, day to day information needed and put together to help find the financial position of a person or an organization. On the right side, we have our assets, and on our left we have liabilities. Assets are things that we own and have, and we list the original value along with the assets. Liabilities are things we owe others, and the list of what we owe and how much is provided by the balance sheet. Little things to keep in mind, is that when creating a balance sheet, assets are usually listed by liquidity. Which means how easily or fast the item could be converted into cash. As well double underline total liabilities & equity and total assets. Don’t forget the dollar signs too! Dollar signs are usually placed on the first amount of both assets and liabilities column. As well as the total liabilities & equity and total assets!
Accounting Equation!
The accounting equation, is the core of the balance sheet. It represents the relationship between assets, liabilities and owner’s equity. The standard accounting equation is Assets = Liabilities + Owner’s Equity. The accounting equation could be manipulated, and be used in different ways such as Assets-Liabilities= Owner’s Equity. Typically in a balance sheet, you would use this formula to find out the net worth/owner’s equity/capital of the person/business by subtracting the total amount of assets by liabilities.
acc 11. 