Accounting Chapter 3
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16 terms
Terms | Definitions |
|---|---|
 Event | A happening of consequence to an entity |
| External Event | An event involving interaction between an entity and its environment |
| Internal Event | An event occurring entirely within an entity |
| Transaction | Any event that is recognized in a set of financial statements |
| Source Document | A piece of paper that is used as evidence to record a transaction |
| Account | A record used to accumulate amounts for each individual asset, liability, revenue, expense, and component of stockholders equity |
| Chart of Accounts | A numerical list of all accounts used by a company |
| General Ledger | A book, a file, a hard drive, or another device containing all of the accounts |
| Debit | An entry on the left side of an account |
| Credit | An entry on the right side of an account |
| Double-entry system | A system of accounting in which every transaction is recorded with equal debits and credits and the accounting equation is kept in balance |
| Journal | A chronological record of transactions |
| Posting | The process of transferring amounts from a journal to the ledger accounts |
| Journalizing | The act of recording journal entries |
| General Journal | The journal used in place of a specialized journal |
| Trial Balance | A list of each account and its balance used to prove equality of debts and credits |
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