【正文】 equation to analyze business transactions. Transactions affects a business’s assets, liabilities, and owner’s equity. Therefore, transactions are analyzed in terms of their effect on the accounting equation.Prepare the financial statements. The financial statements municate information for decision making by the entity’s managers, owners, and creditors and by government agencies. The ine statement presents a video of the entity’s operations in terms of revenues earned and expenses incurred during a specific period. Total revenues minus total expenses equal net ine. Net ine or net loss answers the question, How much ine did the entity earn, or How much loss did it incur during the period? The statement of owner’s equity reports the changes in owner’s equity during the period. The balance sheet provides a photograph of the entity’s financial standing in terms of its assets, liabilities, and owner’s equity at a specific time. It answers the question, What is the entity’s financial position? The statement of cash flows reports the cash ing in and the cash going out during the period. It answers, Where did cash e from , and, Where did it go?Evaluate the performance of a business. High net ine indicates success in business。應用于transaction 交易 principle 原理proprietorship 獨資企業(yè)，所有權 partnership 合伙關系，合伙企業(yè)corporation 公司，企業(yè) entity 實體，統(tǒng)一的，權益ethical 合乎道德的 intended 預期的GAAP 普通會計原理 guideline 方針，指南entity concept 主體概念 reliability principal 可信性原則cost principal 成本原則 goingconcern concept 持續(xù)經(jīng)營概念stablemoneyunit concept 穩(wěn)定貨幣單位的概念 equation 等式 owner’s equity 投資者權益financial statement 財政報表 agency 機構ine statement 損益報表 video 說明revenues 總收入 incurrent 遭受minus 減去 balance sheet 資產(chǎn)負債表，決算表indicate 表明，暗示 expenses 開支，消費Text 2 Recording Business Transaction Define key accounting terms: account, ledger, debit, and credit. The account can be viewed in the form of the letter “T”. The left side of each Taccount is its debit side. The right side is its credit side. The ledger, which contains a record for each account, groups and numbers accounts by category in the following order: assets, liabilities, and owner’s equity (and its subparts, revenues and expenses). Apply the rules of debit and credit. Assets and expenses are increased revenues are increased by credits. Liabilities, owner’s equity, and revenues are increased by credits and decreased by debits. The side—debit or credit—of the account in which increases are recorded is that account’s normal balance. Thus the normal balance of assets and expenses is a debit, and the normal balance of liabilities, owner’s equity, and revenues is a credit. The Withdrawals account, which decreases owner’s equity, normal has a debit balance. Revenues, which are increases in owner’s equity, have a normal credit balance. Expenses, which are decreases in owner’s equity, have a normal debit balance. Record transactions in the journal. The accountant begins the recording process by entering the transaction’s information in the journal, a chronological list of all the business’s transactions. Post from the journal to the ledger. The information is then postedtransferredto the ledger accounts. Posting references are used to trace amounts back and forth between the journal and the ledger. Businesses list their account titles and numbers in a chart of accounts. Prepare a trial balance is a summary of all the account balance in the ledger. When doubleentry accounting has been done correctly, the total credits in the trial balance are equal. Set up a chart of accounts for a business. The first step in accounting is to set up the chart of accounts. Analyze transactions without a journal. Decision makers must often make decisions without a plete accounting system. They can analyze the transactions without a journal. We can now trace the flow of accounting information through these steps: Business Transaction224。 Trial Balance.New wordsledger 分類帳 debit 記入借方的款項，借方assets 資產(chǎn) liabilities 債務subpart 分類 chronological 按時間順序的transfer 轉移 chart 圖表accountant 會計Text 3 Measuring Business Ine: the Adjusting Process Distinguish accrual basis accounting from cashbasis accounting. In accrualbasis accounting, business events are recorded as they affect the entity. In cashbasis accounting, only those events that affect cash are recorded. The cash basis omits important events such as purchases and sales of assets on account. It also distorts the financial statements by labeling as expenses those cash payments that have longterm effects, such as the purchases of buildings and equipment. Some small organizations, use cashbasis accounting, but the generally accepted method is the accrual basis. Apply the revenue and matching principles. Businesses divide time into definite periodssuch as a month, a quarter, and a yearto report the entity39。 s equity. The ending balance of capital is the last amount reported on the balance sheet.New Wordsaccrual n. 自然增長,自然增長額 accrualbasis accounting 權責發(fā)生制 cashbasis accounting 現(xiàn)金收付制 omit vt. 省略，刪 distort vt. 曲解 label vt. 把……列為 definite adj. 明確的,確切的 accounting period 結算期 revenue principle 收益原則 matching principle 配比原則 adjusting entries 調整分錄 update vt . 使現(xiàn)代化 net ine 純收入 prepaid expenses 待攤費用 depreciation accrued expense 應計費用 accrued revenues 應計收入 unaccrued revenues 未實現(xiàn)收入 adjusted trial balance 經(jīng)調整過的試算表 unadjusted trial balance 未經(jīng)調整過的試算表 Text 4 Completing the Accounting Cycle Prepare an accounting worksheet, The accounting cycle is the process by which the accountants produce the financial statements for a special period of time. The cycle starts with the beginning a