1. Analyzing Transactions into Debit and Credit Parts

2. Using T Accounts

3. Assets= Liabilities + OE Left SideRight Side All things Claims against assets owned

4. Transactions change balances of accounts in the equation T account- An accounting device used to analyze transactions Debit-Amount recorded on the left side Credit- Amount recorded on the right side

5. T-Account Left SideRight Side Debit Side Credit Side

6. The increase side rules 1. Assets on the left (debit), increase side on left 2. Liabilities and OE on right (credit), increase on right

7. Normal Balance-Side of the account that is increased Assets normal debit balances Liabilities and OE normal credit balances Accounts decrease on the side opposite their increase Assets decrease on credit Liabilities and OE decrease on debit

8. Analyzing How Transactions Affect Accounts

9. Chart of Accounts- List of accounts used by a business Each transactions affects at least 2 accounts

10. Questions for analyzing a transaction Which accounts are affect? How is each account classified? How is each classification changed? How is each amount entered in the accounts? Accounts Payable-Amounts to be paid in the future for goods or services

11. Accounts Receivable-Amounts to be received in the future due to the sale of goods or services