Accounting Chapter 3 Test Key Vocabulary: T Account Debit Normal Balance Chart of Accounts Credit Focus Ideas: •
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A chart of accounts is a list of accounts used by a company A T Account is an accounting device used to analyze transactions Debit is always on the left, Credit is always on the right Normal balance is the side of the T account that increases DEAD COIL: o Accounts with Debit Normal balances are: ƒ Expenses ƒ Assets ƒ Drawing o Accounts with Credit Normal balances are: ƒ Owner’s Equity ƒ Income/Revenue ƒ Liabilities The four steps to analyzing a transaction: o What accounts are affected? o How is each account affected? o How is each account classified? o How is each amount entered in the T account?