Day 8

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

  1. 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

  1. Make a copy of this spreadsheet.
  2. Place this file in your Chapter 2 folder.
  3. Rename the file to Lesson 2-2-(Your Initials)
  4. 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:  

  1. Prepare two T accounts for each transaction.  On each T account, type the account title of one of the accounts affected by the transaction.
  2. 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

  1. 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:  

    1. Prepare two T accounts for each transaction.  On each T account, type the account title of one of the accounts affected by the transaction.
    2. 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

  1. Complete this self-assessment for Lesson 2-2.  You can use your textbook and notes to complete this assessment.  

Lesson 2-2 Assignment

  1. 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:  

    1. Prepare two T accounts for each transaction.  On each T account, type the account title of one of the accounts affected by the transaction.
    2. 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.