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Business LibreTexts

2: Recording Business Transactions

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  • Learning Objectives

    After studying this chapter, you should be able to:

    • Use the account as the basic classifying and storage unit for accounting information.
    • Express the effects of business transactions in terms of debits and credits to different types of accounts.
    • List the steps in the accounting cycle.
    • Record the effects of business transactions in a journal.
    • Post journal entries to the accounts in the ledger.
    • Prepare a trial balance to test the equality of debits and credits in the journalizing and posting process.
    • Analyze and use the financial results—horizontal and vertical analyses.

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