7 terms

Chapter 2 Vocabulary

STUDY
PLAY
T-Account
An accounting device used to analyze transactions.
Debit
An amount recorded on the left side. Dr
Credit
An amount recorded on the right side.
Normal Balance
The side of the the account that is increased. Relates to the accounting equation.
Chart of Accounts
A list of accounts used by a business
Four questions to ask when analyzing a transaction
1. Which accounts are affected
2. How are they classified
3. How are they changing (increase or decrease)
4. How are they recorded (debit or credit
Two Rules for account balances
1. Always increase on the normal balance side
2. Always decrease opposite the normal balance side.