Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

2. Transaction Analysis

Journal Entries: Debits and Credits

Financial Accounting

2. Transaction Analysis

Journal Entries: Debits and Credits

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Multiple Choice

In a standard journal entry, where is the account title typically entered?

On the right side of the journal entry, with credits listed first and debits indented below

On the left side of the journal entry, with debits listed first and credits indented below

In the explanation section at the bottom of the journal entry

Centered at the top of the journal entry, above the date

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Verified step by step guidance

Understand the structure of a standard journal entry: A journal entry records financial transactions in the accounting system, typically including the date, account titles, debit amounts, and credit amounts.

Recognize the placement of account titles: In a standard journal entry, account titles are entered on the left side of the journal entry. This is a convention used to clearly identify the accounts involved in the transaction.

Identify the order of debits and credits: Debits are listed first, aligned to the left margin, while credits are indented below the debits. This formatting helps distinguish between the two types of entries.

Note the purpose of indentation: Indenting credits below debits visually separates the two and ensures clarity in the journal entry format.

Understand the importance of proper formatting: Properly formatted journal entries are essential for accurate financial reporting and ease of understanding by accountants and auditors.