After completing Lesson 2-2, you will be able to:
- Define accounting terms related to analyzing transactions into debit and credit parts.
- Identify accounting practices related to analyzing transactions into debit and credit parts.
- Use T accounts to analyze transactions showing which accounts are debited or credited for each transaction.
- Analyze how transactions to set up a business affect accounts.
Notes 2-2
- Obtain a Notes 2-2 handout from your instructor and record your notes through the presentation. You can also view the presentation here.
Working Together 2-2
- Make a copy of this spreadsheet.
- Place this file in your Chapter 2 folder.
- Rename the file to Lesson 2-2-(Your Initials)
- Complete the spreadsheet according to the directions below.
T accounts are given in the Working Papers. Your instructor will guide you through the following examples. Kathy Bergum owns Bergum Services. Bergum Services uses the following accounts.
Cash | Accounts Payable-Bales Supplies |
Accounts Receivable-Sam Erickson | Kathy Bergum, Capital |
Supplies | |
Prepaid Insurance |
Directions:
- Prepare two T accounts for each transaction. On each T account, type the account title of one of the accounts affected by the transaction.
- Write the debit or credit amount in each T account to show the transaction’s effect.
Transactions:
Apr. 1 Received cash from owner as an investment, $5,000.00.
Apr. 2 Paid cash for supplies, $50.00.
Apr. 5 Paid cash for insurance, $75.00.
Apr. 6 Bought supplies on account from Bales Supplies, $100.00.
Apr. 9 Paid cash on account to Bales Supplies, $50.00.
On Your Own 2-2
- T accounts are given in the Working Papers. Your instructor will guide you through the following examples. Kathy Bergum owns Bergum Services. Bergum Services uses the following accounts.
Cash Accounts Payable-Nash Supply Accounts Receivable-Jon Roe Derrick Hoffman, Capital Supplies Prepaid Insurance Directions:
- Prepare two T accounts for each transaction. On each T account, type the account title of one of the accounts affected by the transaction.
- Type the debit or credit amount in each T account to show the transaction’s effect.
Transactions:
Sept. 1 Received cash from owner as an investment, $2,000.00.
Sept. 4 Paid cash for insurance, $300.00.
Sept. 5 Paid cash for supplies, $100.00.
Sept. 6 Bought supplies on account from Nash Supply, $230.00.
Sept. 11 Paid cash on account to Nash Supply, $115.00.
Self-Assessment 2-2
- Complete this self-assessment for Lesson 2-2. You can use your textbook and notes to complete this assessment.
Lesson 2-2 Assignment
- Hal Rosen owns Hal’s Marketing Services, which uses the following accounts.
Cash Accounts Payable-All Star Company Supplies Hal Rosen, Capital Prepaid Insurance Accounts Receivable-Dominik Field Directions:
- Prepare two T accounts for each transaction. On each T account, type the account title of one of the accounts affected by the transaction.
- Type the debit or credit amount in each T account to show the transaction’s affected that account.
Transactions:
Mar. 1 Received cash from owner as an investment, $1,000.00.
Mar. 1 Paid cash for insurance, $400.00.
Mar. 3 Bought supplies on account from All Star Company, $600.00.
Mar. 5 Paid cash for supplies, $100.00.
Mar. 8 Paid cash on account to All Star Company, $400.00.