The accounting cycle_1

4-1 source documents what are source documents? they are invoice,receipt,deposit slip,check counterfoil,statement,payment confromation. The first  documents that exist relating to a transaction. its serves as proof for a transaction (include date and time)

INVOICESnormally relate to credit transactions. list goods or services provided and their .suppliers normally send an invoice with goods or servicesalso know as a billindicate payment terms. 

RECEIPTS confirm that service or goods have been receivednormally relate to cash transactions   

DEPOSIT SLIPSproof that cash,including currency and checks has been deposited in a bank account 

CHECK COUNTERFOILthis is the part of the check kept by the drawer(writer) of the check as a record of the transactions

STATEMENTa report showing the amount owed by one business or another.details of the transactions between the two businesses

PAYMENT CONFORMATION when you buy stuff online.

cash receipts journalswhere cash has been  received only 

cash payment journal where all transactions that payout go

cash book and petty cashcash book shows all receipts and payments together petty cash is simply a sum of cash on hand to pay small expenses and could be in a separate journal

sales journal where you record income on credit to income from debtors 

T ACCOUNTS 

Trial balance test of balances ensures debits = creditsuses closing balances from the general ledger (t-accounts)

income statementshows profit or loss of a business includes income and expenses accounting period usually one year 

the statement of changes in equity changes to owners equity capital drawings profitincome-expenses 

balance sheetshows changes over a certain period of time.

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