User Guide

Recording Transactions
5–2 Simply Accounting
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Confidential ACCPAC International
expenses now because he wants to match them to the revenue
that he has already recorded.
Finished recording, he totals the balance sheet again, with the
following result:
National Construction
Balance Sheet
March 5, 1995
Assets: Liabilities:
Cash in Bank $ 37,500 Accounts Payable $ 3,000
Trucks 22,000 Bank Loan 27,000
Maintenance Supplies 1,000 30,000
Furniture 2,000 Equity:
Construction Equipment 20,000 Jim Brown 48,000
Accounts Receivable 6,000
Earnings
$ 88,500
Revenues:
Hauling $ 8,000
Excavating 9,000
17,000
Expenses:
Wages 4,500
Subcontracts 2,000
6,500
Earnings 10,500
58,500
$ 88,500
On March 6, National receives the $3,000 owed from the hauling
contract completed on March 3. Brown had accounted for the
money owed to National by increasing Accounts Receivable by
$3,000. Now that National has been paid, Brown must reduce
Accounts Receivable by $3,000 (to $3,000), and increase Cash in
Bank by $3,000 (to $40,500).
Notice that National was paid the $3,000 that it was owed for
the contract, but that no revenue or earnings were recorded as a
result of this payment. This is because the revenue was
recorded at the time the contract was completed.
National is now simply recording the payment of an amount
owed to it. The act of collecting cash owed reduces Accounts
Receivable and increases Cash in Bank, but does not increase