Because Events That Are Internal to the Firm Are Not

question 44

True/False

Because events that are internal to the firm are not considered "transactions," they do not require entries in the firm's accounts.

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Definitions:

Ledger

A book or collection of accounts in which account transactions are recorded and categorized to show changes in financial positions.

Total Debits

In accounting, this refers to the total sum of all debit entries recorded in all accounts for a given period.

Total Credits

The sum of all credit entries recorded in the accounting books of a business, reflecting the total value of transactions decreasing assets or increasing liabilities and equity.

Beginning Balance

The sum of funds in an account at the beginning of a new accounting cycle, transferred from the conclusion of the last period.