Accounting Self Study Guide for Staff of Micro Finance …

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Accounting Study Guide. Lesson 4. Example:. Assume that an organization buys a motorcycle for Tk10,500 thus adding a. new asset. …

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Accounting - Self Study Guide for Staff of Micro Finance Institutions
LESSON 4
Recording Changes in Financial Position
OBJECTIVES The purpose of this lesson is to examine how the various activities of the organization’s credit operations are recorded. Double-entry accounting is discussed and the methods of recording various transactions are presented. Voucher preparation and journal entries are explained for both Balance Sheet accounts (Assets, Liabilities and Equity) and Income Statement accounts (Revenue and Expenses). In addition, the importance of the Cash account and corresponding periodic bank reconciliations are discussed.
You will develop a good understanding of how to record transactions and what the terms “debit” and “credit” refer to in accounting terms. An understanding of generally accepted accounting principles and accounting methods will be achieved. Topics include:
?Double-Entry Accounting
?Voucher Preparation
?Journal Entries
?Recording Assets, Liabilities and Equity Transactions
?Recording Revenues and Expenses
?Cash Account and Bank Reconciliation
Lessons 4 and 5 describe the steps required from the time an economic transaction occurs until it is ultimately reflected on the financial statements.
Double-Entry Accounting
Go back to Basic Accounting Concepts (Lesson 1) and read through Part…