Accounting: Tools for Business Decision Making, 5th Edition

Published by Wiley
ISBN 10: 1118128168
ISBN 13: 978-1-11812-816-9

Chapter 3 - The Accounting Information System - Self-Test Questions: 3

Answer

b) An employee is terminated.

Work Step by Step

This is not recorded in the books because it is not a transaction. No assets were moved, no liabilities were created, no revenue was earned, and no expenses were incurred. When an employee is terminated, it certainly affects the company, but it will not impact the books whatsoever because there is no actual financial affect.
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