Accounting in business
Respond to the following questions using grammatically correct language and appropriate .
Proficient: Describe the steps in recording and posting the effects of a business transaction and provide some examples of source documents used in these steps. Define debit and credit and name the types of accounts that are (three correct responses): Increased by a debit. Decreased by a debit. Increased by a credit. Decreased by a credit. Distinguished: Correctly identify all of the types of accounts on the list.
Proficient: Which steps in the accounting cycle are performed throughout the accounting cycle? Which of the steps in the accounting cycle are performed only at the end of the accounting period? Distinguished: Many of the steps in the accounting cycle can be performed on a computer with an accounting software package. Research three of the most commonly used packages and decide which one you would choose if you were starting a small business this year.
Proficient: Why are separate “expense” and “revenue” accounts used when all revenues and expenses could be shown directly in the retained earnings account? Describe three examples of transactions that would affect a firm’s income statement. For each transaction, identify if the transaction has a positive or negative effect on the firm’s net income. Distinguished: What is the purpose of the “dividends” account and under what circumstances would this account be increased? Under what circumstances would the “dividends” account be decreased?