Basic Accounting Equations 1. Recognition of normal balances The following items appeared in the accounting records of Triguero’s, a retail music store that also sponsors concerts. Classify each of the items as an asset, liability, revenue, or expense from the company’s viewpoint. Also indicate the normal account balance of each item. a. The albums, tapes, and CDs held for sale to customers. b. A long-term loan owed to Citizens Bank. c. Promotional costs to publicize a concert. d. Daily sales of merchandise sold, e. Amounts due from customers, f. Land held as an investment, g. A new fax machine purchased for office use. h. Amounts to be paid in 10 days to suppliers, i. Amounts paid to a mall for rent.
DQ 1: As you have learned in this week’s readings the Accounting Equation is Assets = Liabilities + Owners’ Equity. Is the accounting equation true in all instances? Provide sample transactions from your own experiences to demonstrate the validity of the Accounting Equation.
DQ2: what does the term account mean? What are the different classifications of accounts? How do the rules for debits and credits impact accounts? Please provide an example of how debits and credits impact accounts.
WEEK 1 JOURNAL
Balance Sheet Journal The balance sheet is a financial snap shot of a company at a particular point in time. The balance sheet lists the assets, liabilities, and equity of the company. Reflect on your personal financial situation, can you apply the concepts of the balance sheet? What did you learn from this reflection?
