Balance Sheet 1
Balance Sheet 1. Definition And Origin Of A Balance Sheet.—we Have Seen That At Any Given Moment The Balances Of Some Accounts In A Business Represent Rights Held By The Business And Rights Held By Others Against The Business. If The Business Is Considered As A Distinct And Separate Entity, ...
Books Of Account 1
Books Of Account 1. Why Entries Cannot Be Made Directly In Ledger Accounts.—the Debits And Credits Connected With Each Business Operation Might, Of Course, Be Recorded Di Rectly In The Accounts Affected, But Such A System Would Entail Certain Dangers That Should Be Noted. The First Main Objection To The ...
Business Profits And Business
Business Profits And Business Capital 1. Reasons For Engaging In Industry.—the Ulti Mate Purpose Of Nearly Every Person Who Participates In Industry Is To Obtain Goods And Services With Which To Satisfy The Wants Of Himself And Dependents. In Modern Society All Of These Goods And Services Are To Be ...
Classification Of Accounts 1
Classification Of Accounts 1. Importance Of Correct Account Classification.— Accounts Are The Basis Of Any Accounting System. The Success With Which They Portray The Effects Of Business Activities Indicates The Value Of The System Itself. Accounts Might Be Likened To Separate Reser Voirs In Which The Records Of The Results ...
Compound Interest Processes And
Compound Interest Processes And Their Use In Business 1. Definition Of Terms.—the Compound Interest Processes Are Used In Many Ways In Business. A Knowledge Of Them Is Especially Necessary In Dealing With The Valuation Of Bonds, The Apportionment Of Bond Discounts And Bond Premiums, And In The Dis Cussion Of ...
Depreciation 1
Depreciation 1. Depreciation Problem Analyzed.—depreciation Is A Phenomenon That Attaches To Durable Physical Assets Like Buildings And Machinery And To Intangible Assets Like Franchises And Patent Rights. It Is That Part Of The Original Outlay On Fixed Assets Which Is Assignable As The Cost Of Service That They Have Al ...
Evolution Of Accounting 1
Evolution Of Accounting 1. Why Accounting Is Necessary.—the Exchange Of Something In The Possession Of One Individual For Some Thing Belonging To Another, Made Its Appearance Early In The Life Of The Race And Was Responsible, In All Probability, For The Invention Of Some Method Of Keep Ing A Record ...
Fundamentals Of Bookkeeping Double Entry
Fundamentals Of Bookkeeping-double Entry 1. Peculiarity Of The Merchandise Account.—before The Introduction Of Double-entry Bookkeeping When An Account With Merchandise Was Set Up, This Account Was Debited When Merchandise Was Purchased Because The (probably Fictitious) Custodian Of Merchandise Was Considered As Getting Into Debt To The Business. Credits To This ...
Fundamentals Of Bookkeeping Single Entry
Fundamentals Of Bookkeeping-single Entry 1. Importance Of Bookkeeping.—liookkeeping, Al Tho It May Be The Least Important Of All The Branches Of Accounting, Is Nevertheless A Prerequisite To The Work Of Inspective And Interpretive Accounting. Therefore, A Knowledge Of Bookkeeping Principles Is Essential To Success In Any Field Of Accounting. It ...
Illustration Of The Application
Illustration Of The Application Of Ing Principles 1. Organization Of The Parker, Webb, Anderson Company.—the Data Contained In This Chapter Repre Sents Actual Transaction With A Change Of Names, Of The Quantities And Values. In Order To Save Space The Month's Operations Are Combined Into A Few Large Transactions. Ralph ...
Income Statement Or Economic
Income Statement Or Economic Summary 1. Purpose Of Financial Statentents.—the Working Sheet Which Was Discussed In The Two Preceding Chap Ters Reduces The Trial Balance Of The Ledger Accounts To A Set Of Figures Which Show, First, The Amount Of Profit Made By The Business During The Year Under Ex ...
Internal Check 1
Internal Check 1. Internal Check.—one Of The Purposes Of An Ac Counting System Is To Insure And Encourage Honesty Upon The Part Of Every Employe. This Can Be Done Best By Minimizing The Opportunities For Dishonesty, And By Placing Such A Check Upon The Work Of Every Man As To ...
Labor Saving Devices 1
Labor Saving Devices 1. Guides In Developing Labor Saving Devices.—no Standard Form Of Record And No Standard Method Of Carrying On Work Has Ever Been Devised Which Would Be Equally Well Adapted To One Business House As To Another. In Developing A System Of Accounting For Any Business Its Particular ...
Methods Of Determining The
Methods Of Determining The Amount Of Depreciation 1. Sinking-fund Method.—the System Of Providing For Depreciation Which Is Known As The Sinking-fund Method, Derives Its Name From The Fact That The Prin Ciple Employed Is The Same As That Used In Building Up A Sinking Fund, Altho Those Who Use This ...
Opening And Closing Entries
Opening And Closing Entries 1. Kinds Of Entries.—the Entries In The Books Of Accounts Which Record The History And Progress Of The Business May Be Grouped Into The Following Three Divi Sions : (1) Opening Entries ; (2 ) Current Entries ; (3 ) Closing Entries. As The Current Entries ...
Posting Media 1
Posting Media 1. Definition Of Posting Media.—posting Media Have Been Previously Defined As The Books In Which A Preparatory Assignment Of Debts And Credits Is Made For Every Business Transaction. The Journal With Its Subdivisions Is The Posting Medium In Modern Ac Counting Systems. Any Book, No Matter What Its ...
Relation Of The Economic
Relation Of The Economic Accounts To The Financial Statements 1. Financial Statement.—in Chapter I We Dis Cussed The Five Main Purposes For Which An Account Ing System Is Constructed. These Purposes Are At Tained Thru Two Related Media : (1) The Permanent Records Of Transactions Contained In The Accounts And ...
Relation Of The Personal
Relation Of The Personal And Property Counts To The Financial Statements 1. First Class Of Accounts To Be Con Sidered Here Are The Asset Accounts. They May Be Divided Into Three Main Classes, Namely: (1) Cash And Cash Items; (2) Promised But Uncollected Income: (3) Instruments With Which To Obtain ...
The Brown Manufacturing Company
The Brown Manufacturing Company Incorporated Under The Laws Of The State Of , With An Authorized Capital Of $25,000 Divided Into One Thousand Shares Of $25 Each. This Entry Would, Of Course, Be Made In The Journal Of The Corporation. The Subscription To The Stock Should Appear In The Subscription ...
Trial Balance 1
Trial Balance 1. A Proof Of Accuracy Becomes Necessary.—no Matter What Kind Of Bookkeeping System Is Used, And No Matter How Highly Developed The System May Be, It Is Impossible For The Bookkeeper To Perform His Duties, Day After Day, Without Making Errors. His Work Is Both Exacting And Monotonous, ...
Valuations For Recording Purposes
Valuations For Recording Purposes 1. Fundamental Principle Involved.—the Book Keeper In Operating His Accounting System Must Re Duce To Financial Records The Effects And Results Of Va Rious Transactions. He Must Establish The Valuations At Which These Facts Will Be Recorded And Base These Valuations Upon Grounds Which Will Make ...