NASCLA Contractos Guide to Business,
Law and Project Management Financial
Section
Bookkeeping - ANS-Involves the accurate recording of all financial transactions that
occur in the business. Financial Statements are derived from this information
The Accounting Cycle - ANS-1) Classifying and recording Transactions.
2) Posting transactions.
3) Preparing a trial balance.
4) Preparing an adjusted trial balance.
5) Preparing financial statements.
6) Analyzing financial statements.
Transaction - ANS-Is an event that either increases or decreases an account balance.
Source Document - ANS-Is the proof that a transaction took place.
Examples of Source Documents - ANS-Cash Receipts, Credit card receipts, customer
invoices, purchase orders, materials invoices, deposit slips, time sheets
Journals - ANS-Daily transactions are recorded in a set of books called..
Typical Journals that companies keep include - ANS-Cash Receipts and Sales Journal,
Purchases Journal, Cash Disbursements journal, Payroll journal, General journal
Cash Receipts and Sales Journal - ANS-is used when cash comes in or a sale is
charged to a customer.
Purchases Journal - ANS-Tracks all purchases made by the company.
Cash Disbursements Journal - ANS-Is used when cash is paid out, examples of this
would be Transactions such as loan payments, and payments on vendor invoices are
recorded here
, Payroll Journal - ANS-Is used to record a summary of payroll details such as salaries
and wages, deductions, and employer contributions.
General Journal - ANS-Used for non cash transactions
Posting - ANS-Is the process of transferring the transactions recorded in the journals to
the appropriate accounts.
Account - ANS-Is a register of value
Examples: Asset, Liability, Equity, Income, Expense
Most companies use 5 Basic types of accounts which are.. - ANS-Asset, Liability,
Equity, Income, and Expense.
Chart Of Accounts - ANS-Is a NUMBERING SYSTEM that organizes these account
types
EXAMPLE:
1000-1999: Assets
2000-2999: Liabilities
3000-3999: Equity
4000-4999: Revenue
5000-5999: Cost Of Goods Sold
6000-6999: Expenses
7000-7999: Other Revenue (i.e., interest income)
8000-8999: Other Expenses (i.e., income taxes)
Side note* Theses accounts should be located in the general ledger
General Ledger - ANS-Is where the chart of Accounts are located
Transactions that are posted, you are transferring them from ____ ___________ to the
general ledger - ANS-The Journal
Trial Balance looks like this - ANS-Account Type Debits Credit
Assets Increases Decreases
Liabilities Decreases Increases
Equity Decreases Increases
Income Decreases Increases
Expenses Increases Decreases
Law and Project Management Financial
Section
Bookkeeping - ANS-Involves the accurate recording of all financial transactions that
occur in the business. Financial Statements are derived from this information
The Accounting Cycle - ANS-1) Classifying and recording Transactions.
2) Posting transactions.
3) Preparing a trial balance.
4) Preparing an adjusted trial balance.
5) Preparing financial statements.
6) Analyzing financial statements.
Transaction - ANS-Is an event that either increases or decreases an account balance.
Source Document - ANS-Is the proof that a transaction took place.
Examples of Source Documents - ANS-Cash Receipts, Credit card receipts, customer
invoices, purchase orders, materials invoices, deposit slips, time sheets
Journals - ANS-Daily transactions are recorded in a set of books called..
Typical Journals that companies keep include - ANS-Cash Receipts and Sales Journal,
Purchases Journal, Cash Disbursements journal, Payroll journal, General journal
Cash Receipts and Sales Journal - ANS-is used when cash comes in or a sale is
charged to a customer.
Purchases Journal - ANS-Tracks all purchases made by the company.
Cash Disbursements Journal - ANS-Is used when cash is paid out, examples of this
would be Transactions such as loan payments, and payments on vendor invoices are
recorded here
, Payroll Journal - ANS-Is used to record a summary of payroll details such as salaries
and wages, deductions, and employer contributions.
General Journal - ANS-Used for non cash transactions
Posting - ANS-Is the process of transferring the transactions recorded in the journals to
the appropriate accounts.
Account - ANS-Is a register of value
Examples: Asset, Liability, Equity, Income, Expense
Most companies use 5 Basic types of accounts which are.. - ANS-Asset, Liability,
Equity, Income, and Expense.
Chart Of Accounts - ANS-Is a NUMBERING SYSTEM that organizes these account
types
EXAMPLE:
1000-1999: Assets
2000-2999: Liabilities
3000-3999: Equity
4000-4999: Revenue
5000-5999: Cost Of Goods Sold
6000-6999: Expenses
7000-7999: Other Revenue (i.e., interest income)
8000-8999: Other Expenses (i.e., income taxes)
Side note* Theses accounts should be located in the general ledger
General Ledger - ANS-Is where the chart of Accounts are located
Transactions that are posted, you are transferring them from ____ ___________ to the
general ledger - ANS-The Journal
Trial Balance looks like this - ANS-Account Type Debits Credit
Assets Increases Decreases
Liabilities Decreases Increases
Equity Decreases Increases
Income Decreases Increases
Expenses Increases Decreases
