Accounting Tuition

WHAT ARE ASSETS?Assets are resources of value owned by the business.

What are drawings?

A. Goods or other assets withdrawn from the business by owners for their personal use are called drawings.

What is the accounting equation? What is the Balance Sheet Equation?

A. Assets = Liabilities + Owner’s Equity

What are Liabilities?Liabilities are amounts owed by a business to external parties.

Assets = Liabilities + Capital + Revenue – Expenses – Drawings

Assets = Liabilities + Capital + Net Profit – Drawings

Assets = Liabilities + Capital – Net Loss – Drawings

WHAT IS AN EXPANDED ACCOUNTING EQUATION?

Source Document

UseCredit Note To inform buyer of the amount to pay

for goods and services supplied

Credit Note To correct an overcharge in the invoice

Debit Note To correct an overchange in the invoice

Payment Voucher An evidence of payment to a named party

Cheque Counterfoil As record of amount paid by chaqueReceipt - To acknowledge money received

Bank Statement Summary of monthly transactions for current account holder

What are the uses of source documents?

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