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12 Cards in this Set
- Front
- Back
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an event that affects the financial position of a business and may be reliably recorded.
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A business transaction
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must balance after each transaction is recorded.
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The accounting equation
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increases the asset, Cash and increases the owner’s equity account, Capital.
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Owner investment
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Increases the asset, Land, and decreases the asset, Cash.
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Cash purchase of land
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increases the asset, Office Supplies, and increases the liability, Accounts Payable.
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Purchase of office supplies on credit
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Increases the asset, Accounts Receivable, and increases Owner’s Equity.
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Providing services (earning revenue) on account
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1.Decreases the asset, Cash, and decreases Owner’s Equity.
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Payment of expenses
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Decreases the asset, Cash, and decreases the liability, Accounts Payable.
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Payment on account
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has no effect on the accounting equation of a business.
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A personal transaction
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Increases the asset, Cash, and decreases another asset, Accounts Receivable.
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Collection on account
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Increases the asset, Cash, and decreases another asset, Land.
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Cash sale of land at cost
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Decreases the asset, Cash, and decreases Owner’s Equity.
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Withdrawal of cash by the owner
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