Skip to main content

Business Finance EBK HEALTHCARE FINANCE: AN INTRODUCTION

The condition that should be met while transaction are posted on the balance sheet . Introduction: Accounting can be defined as a process wherein financial transactions are recorded. This process summarized, evaluates and provides useful insight about these transactions to tax collection entities, regulators and agencies. Accounting helps in summarizing the cash flows, financial position and operation of the company over an accounting period. The condition of accounting identity should be met while posting transaction on the balance sheet. Accounting identity reflects the basic equation of accounting wherein asset should always be equal to equity and liability. It states that the left side of the balance sheet should be equal to the right side. The accounting identity reflects that assets should be equivalent to equity plus liability. Since, each transaction has a dual effect, therefore, the information provided by the accounting identity states that there should be a balance and left side must always be equivalent to the right side so that the effect of the transaction can be offset. Thus, the condition of preserving the basic accounting equation must be met while transactions are being posted on the balance sheet.

The condition that should be met while transaction are posted on the balance sheet . Introduction: Accounting can be defined as a process wherein financial transactions are recorded. This process summarized, evaluates and provides useful insight about these transactions to tax collection entities, regulators and agencies. Accounting helps in summarizing the cash flows, financial position and operation of the company over an accounting period. The condition of accounting identity should be met while posting transaction on the balance sheet. Accounting identity reflects the basic equation of accounting wherein asset should always be equal to equity and liability. It states that the left side of the balance sheet should be equal to the right side. The accounting identity reflects that assets should be equivalent to equity plus liability. Since, each transaction has a dual effect, therefore, the information provided by the accounting identity states that there should be a balance and left side must always be equivalent to the right side so that the effect of the transaction can be offset. Thus, the condition of preserving the basic accounting equation must be met while transactions are being posted on the balance sheet.

Solution Summary: The author defines accounting as a process wherein financial transactions are recorded. The condition of accounting identity should be met while posting transaction on the balance sheet.

EBK HEALTHCARE FINANCE: AN INTRODUCTION

EBK HEALTHCARE FINANCE: AN INTRODUCTION

6th Edition

ISBN: 9781567937428

Author: Gapenski

Publisher: YUZU

See similar textbooks

Concept explainers

Reporting Cash Flows

Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows fro…

A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the …

Financial Statements

Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It…

Owner's Capital

Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expect…

Videos

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

Blurred answer

Chapter 4, Problem 6.3STQ

Chapter 4, Problem 7.2STQ

Students have asked these similar questions

Need answer.

Solve plz now

Precious metal qn solve .

Chapter 4 Solutions

EBK HEALTHCARE FINANCE: AN INTRODUCTION

Ch. 4 - Prob. 1.1STQ Ch. 4 - Prob. 1.2STQ Ch. 4 - Prob. 1.3STQ Ch. 4 - Prob. 1.4STQ Ch. 4 - Prob. 2.1STQ Ch. 4 - Prob. 2.2STQ Ch. 4 - Prob. 2.3STQ Ch. 4 - Prob. 2.4STQ Ch. 4 - Prob. 2.5STQ Ch. 4 - Prob. 3.1STQ

Knowledge Booster

Background pattern image

Finance

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

SEE MORE QUESTIONS

Recommended textbooks for you

Century 21 Accounting Multicolumn Journal
Accounting
ISBN:9781337679503
Author:Gilbertson
Publisher:Cengage
Century 21 Accounting General Journal
Accounting
ISBN:9781337680059
Author:Gilbertson
Publisher:Cengage
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College

Text book image

Century 21 Accounting Multicolumn Journal

Accounting

ISBN:9781337679503

Author:Gilbertson

Publisher:Cengage

Text book image

Century 21 Accounting General Journal

Accounting

ISBN:9781337680059

Author:Gilbertson

Publisher:Cengage

Text book image

Cornerstones of Financial Accounting

Accounting

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Cengage Learning

Text book image

Principles of Accounting Volume 1

Accounting

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax College

SEE MORE TEXTBOOKS

The KEY to Understanding Financial Statements; Author: Accounting Stuff;https://www.youtube.com/watch?v=_F6a0ddbjtI;License: Standard Youtube License