Response to the following:
Part. 1
1. Explain the difference between external events and internal events. Give an example of each type of event.
2. Each economic event or transaction will have a dual effect on financial position. Explain what is meant by this dual effect.
3. What is the purpose of a journal? What is the purpose of a general ledger?
4. Explain the difference between permanent accounts and temporary accounts. Why does an accounting system include both types of accounts?
Part. 2
1. Describe how debits and credits affect assets, liabilities, and permanent owners' equity accounts.
2. Describe how debits and credits affect temporary owners' equity accounts.
3. What is the first step in the accounting processing cycle? What role do source documents fulfill in this step?
4. Describe what is meant by transaction analysis.
5. Describe what is meant by posting, the fourth step in the processing cycle.