LESSON 2-1 Using T Accounts 4/25/2018 LESSON 2-1 Using T Accounts T-accounts are a way of expressing the accounting equation in a manner useful for accountants

ANALYZING THE ACCOUNTING EQUATION LESSON 2-1 4/25/2018 ANALYZING THE ACCOUNTING EQUATION page 28 Describe accounting equation: review concepts from chapter 1. Explain the T Which accounting equation items show up on the left side of the T? Which accounting equation items show up on the right side of the T?

ACCOUNTS page 29 LESSON 2-1 4/25/2018 We can take that same equation and make a device to analyze accounting transactions A t-account is an accounting device used to analyze transactions We label each side of a t-account with the appropriate word: left and right When we use a t-account to analyze a transaction, we use the words DEBIT for an amount recorded on the left side of a t-account and CREDIT for an amount recorded on the the right side) EVERY t-account has this same set of words.

ACCOUNT BALANCES page 29 LESSON 2-1 4/25/2018 Normal Balance: the side of the account that is increased Assets, then, increase on the ? Side Liabilities increase on the ? Side Capital increases on the ? Side

INCREASES AND DECREASES IN ACCOUNTS LESSON 2-1 4/25/2018 INCREASES AND DECREASES IN ACCOUNTS page 30 With the equation on the top, and t-accounts for each element of the equation, we learn how each type of account “works”

TERMS REVIEW T account debit credit normal balance page 31 LESSON 2-1 4/25/2018 TERMS REVIEW page 31 T account debit credit normal balance T-account: an accounting device used to analyze transaction Debit: an amount recorded on the left side of a t-account Credit: an amount recorded on the right side of a t-account Nomal Balance: the side of an account that is increased

LESSON 2-1 Analyzing How Transactions Affect Accounts 4/25/2018 LESSON 2-2 Analyzing How Transactions Affect Accounts

RECEIVED CASH FROM OWNER AS AN INVESTMENT LESSON 2-1 4/25/2018 RECEIVED CASH FROM OWNER AS AN INVESTMENT page 32 August 1. Received cash from owner as an investment, $5,000.00. 2 1 4 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

LESSON 2-1 4/25/2018 PAID CASH FOR SUPPLIES page 33 August 3. Paid cash for supplies, $275.00. 2 1 4 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

PAID CASH FOR INSURANCE LESSON 2-1 4/25/2018 PAID CASH FOR INSURANCE page 34 August 4. Paid cash for insurance, $1,200.00. 2 1 4 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

BOUGHT SUPPLIES ON ACCOUNT LESSON 2-1 4/25/2018 BOUGHT SUPPLIES ON ACCOUNT page 35 August 7. Bought supplies on account from Supply Depot, $500.00. 2 1 4 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

LESSON 2-1 4/25/2018 PAID CASH ON ACCOUNT page 36 August 11. Paid cash on account to Supply Depot, $300.00. 2 1 4 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

TERM REVIEW chart of accounts Do: Work Together 2-2: Do: OYO 2-2 LESSON 2-1 4/25/2018 TERM REVIEW page 37 chart of accounts Do: Work Together 2-2: Text p 31; wp 21 Do: OYO 2-2 Text p 31; wp 22 Do: Application problem 2-1 Text p 46; wp 27

LESSON 2-1 Analyzing How Transactions Affect Owner’s Equity Accounts 4/25/2018 LESSON 2-3 Analyzing How Transactions Affect Owner’s Equity Accounts We have looked at how transactions affect assets and liabilities, as well as the investment of the owner. Now we will look at other transactions that deal with owner’s equity. WIRE

RECEIVED CASH FROM SALES LESSON 2-1 4/25/2018 RECEIVED CASH FROM SALES page 38 August 12. Received cash from sales, $295.00. 2 1 4 WIRE: Revenue transaction 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

SOLD SERVICES ON ACCOUNT LESSON 2-1 4/25/2018 SOLD SERVICES ON ACCOUNT page 39 August 12. Sold services on account to Oakdale School, $350.00. 2 1 4 WIRE: Revenue transaction 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

PAID CASH FOR AN EXPENSE LESSON 2-1 4/25/2018 PAID CASH FOR AN EXPENSE page 40 August 12. Paid cash for rent, $300.00. 2 1 4 3 WIRE: Expense transaction 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

RECEIVED CASH ON ACCOUNT LESSON 2-1 4/25/2018 RECEIVED CASH ON ACCOUNT page 41 August 12. Received cash on account from Oakdale School, $200.00. 2 1 4 Not a WIRE transaction 3 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

PAID CASH TO OWNER FOR PERSONAL USE LESSON 2-1 4/25/2018 PAID CASH TO OWNER FOR PERSONAL USE page 42 August 12. Paid cash to owner for personal use, $125.00. 2 1 4 3 WIRE: Withdrawal 1. Which accounts are affected? 2. How is each account classified? 3. How is each classification changed? 4. How is each amount entered in the accounts?

Chapter 2 Work Do: Work Together: Text p 44; wp 25 LESSON 2-1 4/25/2018 Chapter 2 Work Do: Work Together: Text p 44; wp 25 OYO: Text p 44; wp 26 Do: Recycling problem 2-1 TOGETHER (mastery problem example) Graded work for chapter 2: Study Guide 2; wp 17, 18, 19 correct in class Mastery Problem 2-5; p 47 text; wp 31 Xcred: Challenge Problem 2-6; text p 48, wp 32 TEST: CHAPTER 2