This video is not some psychic talking about your brain, but it IS taking apart various kinds of business transactions so that you will be able to correctly prepare the transaction for entry into your accounting records.

The first three steps of the four-step analysis process are after reading the transaction:

1. Identify what accounts are involved.

2. Determine whether each account is A, L, OE, R or E

3. Decide if each account will be increased or decreased by this action.

4. In the next chapter, we will look at T accounts as representations of accounting ledger accounts, debit or credit based upon your answers to the last three questions.

I guarantee that if you analyze each transaction NOW using the above three steps (4th step in Chapter 3), you will feel more accurate and confident this quarter. EVEN IF the steps SEEMS SLOW, your brain will learn the them so that you will be able to quickly and correctly analyze transaction. I beg you to take the time.

Transaction Analysis

Analyzing Basic Accounting TransactionsTransaction Analysis - Basic Example