ASS #1 DRAFT (KCQs)

Chapter 1: A way of viewing business

From the beginning, Accounting is a complicated subject for understanding, Chapter 1 helps us to know the most basic factors in this course and make this course easier and more understandable.

My Understanding for Chapter 1:

• Double-Entry accounting explaining the fundamentum of  Accounting, every transaction should be have both detail by both side of equal sign, then we can keep the account balance.
• Debit and Credit is two totally different thing but have connection as well, this part is kind of interesting, Asset as Debit is to own, Equity and Liability as Credit are to owe, but they just cancelled out by the equation.
• Accounting equations is a basic principle which can not be change for this course, every account should obey to the principle.
• Way of viewing a business should refer to 5 elements of accounting, every change of the 5 elements means profit or loss.

My Confusing for Chapter 1:

As Chapter 1 has describe every basic detail in Accounting, most of the knowledge I could understand, but at the same time, something interesting came out, As Accounting is such a specific course, will there be more equation or more detail in accounting create and bring into practice in the future? Will the 5 elements in accounting change in the future? or we can say is there one day Double-Entry accounting will be break or change? 

Chapter 3: Introducing Financial Statement

As Financial Statement is a basic form of record of financial activities of a business, person or equity, what should Financial Statement obey or follow were clearly introduced in this chapter.

My Understanding for Chapter 3:

• One Financial Statement should containing Balance sheet, Income statement and Statement of Changes in Equity.
• Financial Statement should obey the principle equation of accounting.
• 5 Elements of accounting should be all contained in Financial Statement.

My Confusing for Chapter 3:

I am still confusing about the definition for cash flow and what's the difference between Cash Inflow and Cash Outflow? As Chapter 3 is very important for the further course study, I think i should have more time to focus on this part and the spreadsheet making.