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Mcgraw Hill Accounting Chapter 4 Homework Answers
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1) The Basics Of Debits And Credits
The Basics of Debits and Credits
Debit and credit are accounting terms that represent two sides of a transaction. A debit is recorded as an increase in asset, liability, or equity. Credit is recorded as a decrease in asset, liability, or equity. The difference between debits and credits is found in their respective direction. Assets, liabilities and equities can be increased by recording a debit, or they can be decreased by recording a credit. For example: if you purchased $5 worth of food for lunch with cash then there would be an increase in cash (a debit) and at the same time there would also be an increase in food inventory (a credit). When calculating margins or ratios, it is important to note whether each line should have been recorded as a debit or a credit. There will always be either two increases (debit)or one decrease (credit) but never three increases.
2) How To Prepare A Trial Balance
A trial balance is a listing of all of the accounts in a company and their balances. Here’s how it works:
– List all of the accounts in a company and their balances in alphabetical order. For example, Assets = $8,000; Liabilities = $0; Equity = $6,000.
– Add up each column using either a calculator or pen and paper. For example, if Assets are $8,000; Liabilities are $0; Equity is $6,000 then Assets = 8,000 + 0 + 6,000 = 14,000 (per line).
– Repeat this process for every account until you reach one that has an ending balance of zero (such as Cash).
3) What Is A Ledger?
A ledger is a book that contains all of a company’s financial transactions. A company’s accounting system will record each transaction in a separate journal entry and then post it to one of three types of ledgers: general, purchase, or sales. This is called journaling. In order to maintain accurate records, every entry must be recorded in the correct type of account within one of these books.
In order for a company to ensure accurate records and data, there needs to be consistency with where entries are posted. For example, if you make an online purchase for $10 from Amazon using your credit card, this would be recorded as an expense within your bank account (which is also known as cash flow) because it was paid with cash from you instead of borrowed money (also known as accounts receivable).
There are many different types of accountancy but we will focus on only four for now: General Ledger; Cash Accounts; Bank Accounts; Inventory Accounts.
4) What Are Journal Entries?
Journal entries are important for keeping track of transactions. A journal entry is a summary of an event, transaction, or other activity that you have entered into a ledger. By summarizing these events, you can keep track of what happened and when it happened. It is important to keep complete and accurate records of all financial transactions because they can be very complex and difficult to decipher if the information isn’t organized well. Journal entries are used as part of an accounting system in order to maintain financial records like balance sheets, income statements, and cash flow statements. The four basic types of journal entries are 1) receipts 2) payments 3) adjustments 4) non-cash items such as depreciation or amortization.
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The website for this post is for people looking for answers to chapter four of McGraw Hill’s accounting book. The site has all of the answers and questions from chapter four, so if you need help with a particular question, this site will be able to assist you.
What are the chapter 4 homework answers?
The following are some of the questions and solutions from McGraw Hill’s Accounting Chapter 4 Homework Answers.
1) Write a sentence that reflects an assumption made in preparation for preparing a balance sheet.
In order to prepare a balance sheet, one must make assumptions about how long an asset will be used, how much of it there is, and what its market value is.
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