The Accounting Cycle. Chapters 4 and 3

Save this PDF as:
 WORD  PNG  TXT  JPG

Size: px
Start display at page:

Download "The Accounting Cycle. Chapters 4 and 3"

Transcription

1 The Accounting Cycle Chapters 4 and 3

2 Accumulate...

3 Accumulate... Communicate!

4 Business Transactions Source Documents Analyzed Journalized Posted

5 The Accounting Cycle 1. Business transactions create source documents. 2. Transactions are analyzed, 3. Journalized, and posted to the ledger. 4. A trial balance is prepared. 5. Data needed to adjust the accounts are assembled. 6. A work sheet is prepared. 7. The financial statements are prepared. 8. Adjusting entries are journalized and posted. 9. Closing entries are journalized and posted. 10. A post-closing trial balance is prepared.

6 The Accounting Cycle 1. Business transactions create source documents. 2. Transactions are analyzed, 3. Journalized, and posted to the ledger. Chapters 1 & 2 4. A trial balance is prepared. 5. Data needed to adjust the accounts are assembled. 6. A work sheet is prepared. 7. The financial statements are prepared. 8. Adjusting entries are journalized and posted. 9. Closing entries are journalized and posted. 10.A post-closing trial balance is prepared.

7 The Accounting Cycle 1. Business transactions create source documents. 2. Transactions are analyzed, 3. Journalized, and posted to the ledger. 4. A trial balance is prepared. 5. Data needed to adjust the accounts are assembled. 6. A work sheet is prepared. Today 7. The financial statements are prepared. 8. Adjusting entries are journalized and posted. 9. Closing entries are journalized and posted. 10.A post-closing trial balance is prepared.

8 The Accounting Cycle 1. Business transactions create source documents. 2. Transactions are analyzed, 3. Journalized, and posted to the ledger. 4. A trial balance is prepared. 5. Data needed to adjust the accounts are assembled. 6. A work sheet is prepared. 7. The financial statements are prepared. 8. Adjusting entries are journalized and posted. 9. Closing entries are journalized and posted. 10.A post-closing trial balance is prepared. Homework

9 The Accounting Cycle 1. Business transactions create source documents. 2. Transactions are analyzed, 3. Journalized, and posted to the ledger. 4. A trial balance is prepared. 5. Data needed to adjust the accounts are assembled. 6. A work sheet is prepared. 7. The financial statements are prepared. 8. Adjusting entries are journalized and posted. 9. Closing entries are journalized and posted. 10.A post-closing trial balance is prepared. 1st Discussion

10

11

12

13 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

14 Supplies Adjusting Entry

15 Adjusting Entry Beg. Bal. Supplies

16 Adjusting Entry Beg. Bal. + Purchases Supplies

17 Adjusting Entry Beg. Bal. + Purchases Supplies mixed

18 Adjusting Entry Supplies Supplies Expense Beg. Bal. + Purchases used used

19 Adjusting Entry Supplies Supplies Expense Beg. Bal. + Purchases used used Bal. = EI

20 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

21 Adjusting Entry Supplies Supplies Expense BB 970 used? used? B = 170

22

23 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

24 Adjusting Entry Prepaid Insurance Beg. Bal. + Prem Pd

25 Adjusting Entry Prepaid Insurance Beg. Bal. + Prem Pd mixed

26 Adjusting Entry Prepaid Insurance Insurance Expense Beg. Bal. + Prem Pd expired expired

27 Adjusting Entry Prepaid Insurance Insurance Expense Beg. Bal. + Prem Pd expired expired B = unexpired

28 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

29 Adjusting Entry Prepaid Insurance Insurance Expense 1,800 expired expired B = unexpired $1,100?? $ 700??

30 ADDITIONAL INFORMATION: Supplies on hand Insurance EXPIRED Depreciation for period 1, Wages accrued 1,025.00

31

32 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

33 Adjusting Entry cost Equipment

34 Adjusting Entry cost Equipment Depr. Expense X

35 Adjusting Entry Equipment Depr. Expense cost Acc. Depr. X X

36 Adjusting Entry Equipment Depr. Expense cost Acc. Depr. X contra X

37 Adjusting Entry Equipment Depr. Expense cost Acc. Depr. X X

38 Adjusting Entry Equipment Depr. Expense cost Acc. Depr. X X Equipment Acc. Depr.

39 Adjusting Entry Equipment Depr. Expense cost Acc. Depr. X X Equipment Acc. Depr. = Book Value

40

41 ADDITIONAL INFORMATION: Supplies on hand I Insurance expired Depreciation for period 1, Wages accrued 1, II.

42 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

43 Consider this...

44 Consider this...

45 Consider this...

46 Consider this... expense

47 Consider this... expense accrual

48 ADDITIONAL INFORMATION: Supplies on hand Insurance expired Depreciation for period 1, Wages accrued 1,025.00

49

50 Totals

51

52 +

53 + =

54 + =

55

56

57

58

59

60

61

62

63

64

65

66

67

68

69

70

71

72 Totals

73

74

75

76 ???

77 ???

78 Learn to Classify Accounts P 5 ways: A, L, C(OE), R, E P 2 ways: B.S. or I.S. P 2 ways: real or nominal

79 Learn to Classify Accounts P 5 ways: P 2 ways: A, L, C(OE), R, E B.S. or I.S. P 2 ways: real or nominal

80

81

82

83

84

85

86

87

88

89

90

91

92

93

94

95

96

97

98

99

100

101

102

103

104

105

106

107

108

109 The Accounting Cycle 1. Business transactions create source documents. 2. Transactions are analyzed, 3. Journalized, and posted to the ledger. 4. A trial balance is prepared. 5. Data needed to adjust the accounts are assembled. 6. A work sheet is prepared. 7. The financial statements are prepared. 8. Adjusting entries are journalized and posted. 9. Closing entries are journalized and posted. 10. A post-closing trial balance is prepared.

Time Period Assumption

Time Period Assumption ILLUSTRATION 3-1 GUIDELINES TO REPORT REVENUE AND EXPENSES Time Period Assumption Economic life of business can be divided into artificial time periods Revenue Recognition Principle Revenue recognized

More information

Closing Entries and the Postclosing Trial Balance

Closing Entries and the Postclosing Trial Balance 6-1 McGraw-Hill 2009 The McGraw-Hill Companies, Inc. All rights reserved. Chapter Closing Entries and the Postclosing Trial Balance 6 Section 1: Closing Entries Section Objectives 1. Journalize and post

More information

Completing the Accounting Cycle

Completing the Accounting Cycle C H A P T E R 4 Completing the Accounting Cycle Financial Accounting 14e Warren Reeve Duchac human/istock/360/getty Images Flow of Accounting Information (slide 1 of 5) End-of-Period Spreadsheet (Work

More information

Adjusting Entries and the Work Sheet

Adjusting Entries and the Work Sheet Heintz & Parry th Edition Chapter 5 th Edition College Accounting Adjusting Entries and the Work Sheet 1 Prepare end-of-period adjustments. END-OF-PERIOD ADJUSTMENTS Changes occur that affect the business

More information

WHY ADJUSTING JOURNAL ENTRIES? CHAPTER FIVE. ADJUSTING ENTRIES Page 145 MATCHING PRINCIPLE WHY ENDING BALANCE NOT CORRECT?

WHY ADJUSTING JOURNAL ENTRIES? CHAPTER FIVE. ADJUSTING ENTRIES Page 145 MATCHING PRINCIPLE WHY ENDING BALANCE NOT CORRECT? CHAPTER FIVE ADJUSTING ENTRIES Page 1 WHY ADJUSTING JOURNAL ENTRIES?! All amounts must be correct before financial statements printed! Test ending balance in each account! Auditing! Test accounting system,

More information

Accruals, Deferrals,

Accruals, Deferrals, 12-1 McGraw-Hill 2007 The McGraw-Hill Companies, Inc. All rights reserved. Chapter Accruals, Deferrals, 12 and the Worksheet Section 1: Calculating and Recording Adjustments Section Objectives 1. Determine

More information

Accounting II Second Semester Final

Accounting II Second Semester Final Name: Class: Date: Accounting II Second Semester Final Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. 1. Profit is the difference between:

More information

Chapter 4. Completing the accounting cycle. Appendix 4A: Reversing entries

Chapter 4. Completing the accounting cycle. Appendix 4A: Reversing entries 1 Chapter 4 Completing the accounting cycle Appendix 4A: Reversing entries 2 Learning objective 1. Prepare reversing entries and describe their purpose 3 Reversing entries Reversing entries are optional

More information

Supplement to CHAPTER 3 CLOSING ENTRIES AND THE WORK SHEET

Supplement to CHAPTER 3 CLOSING ENTRIES AND THE WORK SHEET Supplement to CHAPTER 3 CLOSING ENTRIES AND THE WORK SHEET Answers to Review Questions 1. No, the work sheet cannot be used as a substitute for the financial statements. It is a tool used in preparing

More information

Chapter 4 Adjustments, Financial Statements, and the Quality of Earnings

Chapter 4 Adjustments, Financial Statements, and the Quality of Earnings Chapter 4 Adjustments, Financial Statements, and the Quality of Earnings ANSWERS TO QUESTIONS 1. Adjusting entries are made at the end of the accounting period to record all revenues and expenses that

More information

CHAPTER 3 The Accounting Information System

CHAPTER 3 The Accounting Information System CHAPTER 3 The Accounting Information System 3-1 LECTURE OUTLINE Chapter 3 provides a review of accounting procedures throughout the accounting cycle. Depending on time constraints and students accounting

More information

CHAPTER 3: PREPARING FINANCIAL STATEMENTS

CHAPTER 3: PREPARING FINANCIAL STATEMENTS CHAPTER 3: PREPARING FINANCIAL STATEMENTS I. TIMING AND REPORTING A. The Accounting Period Time period assumption an organization s activities can be divided into specific time periods. Examples: a month,

More information

1. If the assets owned by a business total $100,000 and liabilities total $70,000, stockholders' equity totals $30,000.

1. If the assets owned by a business total $100,000 and liabilities total $70,000, stockholders' equity totals $30,000. Rallis Page 1 Name: _ Date: 1. If the assets owned by a business total $100,000 and liabilities total $70,000, stockholders' equity totals $30,000. A) True B) False 2. If total liabilities decreased by

More information

CHAPTER 4. Adjusting the accounts and preparing financial statements CONTENTS

CHAPTER 4. Adjusting the accounts and preparing financial statements CONTENTS CHAPTER 4 Adjusting the accounts and preparing financial statements CONTENTS Demonstration problem 4.1 Adjusting entries and corrections 4.2 Adjusting centries and effect on financial statements 4.3 Adjusting

More information

Vol. 1, Chapter 3 - Accounting Adjustments

Vol. 1, Chapter 3 - Accounting Adjustments Vol. 1, Chapter 3 - Accounting Adjustments Problem 1 1. ($20,000 2,000) 48 = $375 per month 2. Jan. 31 Depreciation Expense $375 Accumulated Depreciation Van $375 To record depreciation expense for January

More information

> DO IT! Chapter 3 Adjusting the Accounts. Timing Concepts. Adjusting Entries for Deferrals D-12. Solution

> DO IT! Chapter 3 Adjusting the Accounts. Timing Concepts. Adjusting Entries for Deferrals D-12. Solution Chapter 3 Adjusting the Accounts Timing Concepts Review the glossary terms. Study carefully the revenue recognition principle, the expense recognition principle, and the time period assumption. Several

More information

SOLUTIONS. Learning Goal 16

SOLUTIONS. Learning Goal 16 Learning Goal 16: Prepare Closing Entries S1 Learning Goal 16 Multiple Choice 1. d 2. a 3. b 4. d Because drawing is closed directly into the capital account, not into income summary. 5. c 6. b This a

More information

COMPLETION OF THE ACCOUNTING CYCLE - Closing Entries -

COMPLETION OF THE ACCOUNTING CYCLE - Closing Entries - COMPLETION OF THE ACCOUNTING CYCLE - Closing Entries - Worksheet Overview Trial Balance Adjustments Adjusted Trial Balance Income Statement Balance Sheet Account Titles Debit Credit Debit Credit Debit

More information

CHAPTER 3 THE ADJUSTING PROCESS

CHAPTER 3 THE ADJUSTING PROCESS 1. a. Under cash-basis accounting, revenues are reported in the period in which cash is received and expenses are reported in the period in which cash is paid. b. Under accrual-basis accounting, revenues

More information

The Adjusting Process

The Adjusting Process Chapter 03.qxd 5/21/08 7:07 PM Page 99 C H A P T E R 3 AP Photo/Jeff Kravitz Fo r Sa le The Adjusting Process M A R V E L D E N T E R T A I N M E N T, N ot o you subscribe to any magazines? Most of us

More information

Chapter 4. Completing the accounting cycle

Chapter 4. Completing the accounting cycle 1 Chapter 4 Completing the accounting cycle 2 Learning objectives 1. Prepare an accounting worksheet and describe its purpose 2. Prepare a classified balance sheet and explain the major headings 3. Explain

More information

CHAPTER 3 ADJUSTING THE ACCOUNTS

CHAPTER 3 ADJUSTING THE ACCOUNTS CHAPTER 3 ADJUSTING THE ACCOUNTS TIME PERIOD ASSUMPTION The time period (or periodicity) assumption assumes that the economic life of a business can be divided into artificial time periods generally a

More information

THE ACCOUNTING INFORMATION SYSTEM

THE ACCOUNTING INFORMATION SYSTEM CHAPTER 3 THE ACCOUNTING INFORMATION SYSTEM OVERVIEW Accounting information must be accumulated and summarized before it can be communicated and analysed. In this chapter, we will discuss the steps involved

More information

EXERCISES. Does not normally require adjustment. Normally requires adjustment (AE).

EXERCISES. Does not normally require adjustment. Normally requires adjustment (AE). EXERCISES Ex. 3 1 1. Prepaid expense 2. Accrued revenue 3. Unearned revenue 4. Accrued expense 5. Unearned revenue 6. Prepaid expense 7. Accrued expense 8. Accrued expense Ex. 3 2 Account Accounts Receivable...

More information

Chapter 6 Statement of Cash Flows

Chapter 6 Statement of Cash Flows Chapter 6 Statement of Cash Flows The Statement of Cash Flows describes the cash inflows and outflows for the firm based upon three categories of activities. Operating Activities: Generally include transactions

More information

Accumulated Depreciation Equipment

Accumulated Depreciation Equipment Chapter 4 Completing the Accounting Cycle > DO IT! Worksheet Balance sheet: Extend assets to debit column. Extend liabilities to credit column. Extend contra assets to credit column. Extend drawings account

More information

CHAPTER 4 Accrual Accounting Concepts Study Objectives

CHAPTER 4 Accrual Accounting Concepts Study Objectives CHAPTER 4 Accrual Accounting Concepts Study Objectives Explain the revenue recognition principle and the matching principle. Differentiate between the cash basis and the accrual basis of accounting. Explain

More information

Review of the Accounting Process THE BASIC MODEL

Review of the Accounting Process THE BASIC MODEL THE BASIC MODEL The accounting information system is designed to collect and organize data into information that is useful for stakeholders. The Accounting Equation The basic accounting equation is what

More information

Adjusting the Accounts

Adjusting the Accounts HOSP 1210 (Financial Acct) Learning Centre Adjusting the Accounts Anytime we prepare financial statements or reach the end of an accounting period, there are account adjustments that need to be made to

More information

CHAPTER 6. Accounting for retailing CONTENTS

CHAPTER 6. Accounting for retailing CONTENTS CHAPTER 6 Accounting for retailing CONTENTS 6.1 Journal entries periodic inventory system 6.2 Journal entries involving discounts, closing entries and statements of financial performance both perpetual

More information

Advanced Accounting. Chapter 4: Financial Reporting for a Departmentalized Business

Advanced Accounting. Chapter 4: Financial Reporting for a Departmentalized Business Advanced Accounting Chapter 4: Financial Reporting for a Departmentalized Business Financial statements are used to summarize financial info and then are used to evaluate the financial position and progress

More information

Accruals and prepayments

Accruals and prepayments Accruals and prepayments Introduction These are adjustments which need to be carried out before the financial statements can be produced. The adjustments are necessary as accounts are prepared in accordance

More information

Accounting 300A-10A The Operating Cycle: Worksheet/Closing Entries Page 1

Accounting 300A-10A The Operating Cycle: Worksheet/Closing Entries Page 1 Accounting 3A-1A The Operating Cycle: Worksheet/Closing Entries Page 1 THE WORKSHEET and CLOSING ENTRIES I. Review of Key Concepts and Terms: A. The purpose of the worksheet 1. To show that the accounts

More information

Accrual accounting ACCRUAL VERSUS CASH BASIS OF ACCOUNTING. ACCRUAL VERSUS CASH BASIS OF ACCOUNTING continued. Chapter 3

Accrual accounting ACCRUAL VERSUS CASH BASIS OF ACCOUNTING. ACCRUAL VERSUS CASH BASIS OF ACCOUNTING continued. Chapter 3 Chapter 3 Accrual accounting concepts PowerPoint presentation by Anne Abraham University of Wollongong 2009 John Wiley & Sons Australia, Ltd ACCRUAL VERSUS CASH BASIS OF ACCOUNTING Accrual-based accounting

More information

CENTURY 21 ACCOUNTING, 8e General Journal Chapter Objectives

CENTURY 21 ACCOUNTING, 8e General Journal Chapter Objectives CENTURY 21 ACCOUNTING, 8e General Journal Chapter Objectives Chapter 1 Starting A Proprietorship: Changes that Affect the Accounting Equation After studying Chapter 1, you will be able to: 1. Define accounting

More information

In the event of a tie, the score on the last ten questions will be used as a tie-breaker.

In the event of a tie, the score on the last ten questions will be used as a tie-breaker. NEW YORK STATE ASSOCIATION FUTURE BUSINESS LEADERS OF AMERICA SPRING DISTRICT MEETING ACCOUNTING II 2010 TEST DIRECTIONS 1. Complete the information requested on the answer sheet. PRINT your name on the

More information

CHAPTER 2 REVIEW OF THE ACCOUNTING PROCESS. Lecture Outline

CHAPTER 2 REVIEW OF THE ACCOUNTING PROCESS. Lecture Outline CHAPTER 2 REVIEW OF THE ACCOUNTING PROCESS Overview Chapter 1 explained that the primary means of conveying financial information to investors, creditors, and other external users is through financial

More information

COMPLETING THE ACCOUNTING CYCLE

COMPLETING THE ACCOUNTING CYCLE 4 COMPLETING THE ACCOUNTING CYCLE objectives After studying this chapter, you should be able to: Review the seven basic steps of the accounting cycle. Prepare a work sheet. Prepare financial statements

More information

PART A: TRUE/FALSE (1 point each):

PART A: TRUE/FALSE (1 point each): CHABOT COLLEGE General Accounting (BUS-7) Dmitriy Kalyagin PART A: TRUE/FALSE (1 point each): EXAM #4 (Chapters 10, 12, 13) 1. Employees who are exempt from the FLSA are entitled for overtime pay for hours

More information

Chapter 5 Accrual Adjustments and Financial Statement Preparation. Revenue recognition Matching expenses to revenues Expenses related to periods

Chapter 5 Accrual Adjustments and Financial Statement Preparation. Revenue recognition Matching expenses to revenues Expenses related to periods Chapter 5 Accrual Adjustments and Financial Statement Preparation Revenue recognition Matching expenses to revenues Expenses related to periods 1 The Measurement of Income major function of accounting

More information

The worksheet for Hancock Company shows the following in the financial statement

The worksheet for Hancock Company shows the following in the financial statement Chapter 4 Do it! Susan Elbe is preparing a worksheet. Explain to Susan how she should extend the following adjusted trial balance accounts to the financial statement columns of the worksheet. Cash Accumulated

More information

For More Course Tutorials Visit www.uoptutorial.com

For More Course Tutorials Visit www.uoptutorial.com ACC 205 WEEK 2 EXERCISE ASSIGNMENT REVENUE AND EXPENSES(NEW) Click Here to Buy the Tutorial http://www.uoptutorial.com/index.php?route=product/p roduct&path=641&product_id=9760 For More Course Tutorials

More information

Accrual Accounting Process

Accrual Accounting Process Accrual Accounting Process 15.501 Accounting Spring 2004 Professor S. Roychowdhury Sloan School of Management Massachusetts Institute of Technology Feb 17/18, 2004 1 An accountant s functions include Classifying

More information

2-8. Identify whether each of the following items increases or decreases cash flow:

2-8. Identify whether each of the following items increases or decreases cash flow: Problems 2-8. Identify whether each of the following items increases or decreases cash flow: Increase in accounts receivable Increase in notes payable Depreciation expense Increase in investments Decrease

More information

TOPIC LEARNING OBJECTIVE

TOPIC LEARNING OBJECTIVE Topic Mapping 1 Transaction Analysis Understand the effect of various types of transactions on the accounting equation, accounting journal and accounting ledger. Concepts and Skills Accounting Equation

More information

Module 3: Adjusting the accounts, preparing the statements, and completing the accounting cycle

Module 3: Adjusting the accounts, preparing the statements, and completing the accounting cycle Course Schedule Course Modules Review and Practice Exam Preparation Resources Module 3: Adjusting the accounts, preparing the statements, and completing the accounting cycle Overview In Module 2 you studied

More information

Chapter 13 Financial Statements and Closing Procedures

Chapter 13 Financial Statements and Closing Procedures Chapter 13 - Financial Statements and Closing Procedures Chapter 13 Financial Statements and Closing Procedures TEACHING OBJECTIVES 13-1) Prepare a classified income statement from the worksheet. 13-2)

More information

TRANSACTIONS ANALYSIS EXAMPLE. Maxwell Partners Medical Diagnostic Services report the following information for 2011, their first year of operations:

TRANSACTIONS ANALYSIS EXAMPLE. Maxwell Partners Medical Diagnostic Services report the following information for 2011, their first year of operations: TRANSACTIONS ANALYSIS EXAMPLE Maxwell Partners Medical Diagnostic Services report the following information for 2011, their first year of operations: 1. Billings to clients for services provided: $350,000

More information

BAT 4M: Chapter 3 ANSWERS TO QUESTIONS

BAT 4M: Chapter 3 ANSWERS TO QUESTIONS BAT 4M: Chapter 3 ANSWERS TO QUESTIONS 01. (a) Under the time period assumption, an accountant is required to determine the relevance of each business transaction to specific accounting periods, and its

More information

Accrual Accounting Process: Part II

Accrual Accounting Process: Part II Accrual Accounting Process: Part II 15.511 Corporate Accounting Summer 2003 Professor S.P. Kothari Sloan School of Management Massachusetts Institute of Technology June 14, 2003 1 Agenda for Today Continue

More information

Accounting Cycle. Matching Principle

Accounting Cycle. Matching Principle CHAPTER 3 Accounting Cycle Analyze and record the transactions Post the transactions and prepare trial balance Adjust the accounts and prepare trial balance Prepare the financial statements Close the accounts

More information

Unit 2 The Basic Accounting Cycle

Unit 2 The Basic Accounting Cycle Unit 2 The Basic Accounting Cycle Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 Chapter 8 Chapter 9 Business Transactions and the Accounting Equation Transactions That Affect Assets, Liabilities, and

More information

Exam 1 chapters 1-4 Needles 10ed

Exam 1 chapters 1-4 Needles 10ed Exam 1 chapters 1-4 Needles 10ed Multiple Choice Identify the choice that best completes the statement or answers the question. 1. Which of the following is the most appropriate definition of accounting?

More information

ACCOUNTING LIFEPAC 7 ADJUSTING & CLOSING ENTRIES

ACCOUNTING LIFEPAC 7 ADJUSTING & CLOSING ENTRIES Unit 7 ACCOUNTING LIFEPAC 7 ADJUSTING & CLOSING ENTRIES CONTENTS I. ADJUSTING ENTRIES.............................. 3 The Purpose of the Worksheet....................... 3 The Need for Adjustments..........................

More information

Basic Accounting Principles

Basic Accounting Principles Basic Accounting Principles Basic Accounting Model The basic accounting model represents the relationship between assets (what the company owns), liabilities (what the company owes), and owner s equity

More information

The Work Sheet and the Closing Process

The Work Sheet and the Closing Process C H A P T E R 4 The Work Sheet and the Closing Process A systematic approach is essential for efficient and accurate processing of large amounts of information. Whether work sheets are on paper or computerized,

More information

The Matching Concept and the Adjusting Process

The Matching Concept and the Adjusting Process The Matching Concept and the Adjusting Process o b j e c t i v e s After studying this chapter, you should be able to: 4 Explain how the matching concept relates to the accrual basis of accounting. Explain

More information

T-Account Approach to Preparing a Statement of Cash Flows Indirect Method

T-Account Approach to Preparing a Statement of Cash Flows Indirect Method 266 Part 1 E M Foundations of Financial Accounting With these adjustments to the income statement, we can now present the operating activities section of the statement of cash flows using either the direct

More information

Course: Introduction to Accounting and Financial Reporting I, ACCT 113. Required Text: Fundamentals of Accounting Principles, Latest edition; Larson

Course: Introduction to Accounting and Financial Reporting I, ACCT 113. Required Text: Fundamentals of Accounting Principles, Latest edition; Larson Institution: Great Bay Community College Course: Introduction to Accounting and Financial Reporting I, ACCT 113 Required Text: Fundamentals of Accounting Principles, Latest edition; Larson Packet Contents:

More information

Learner Note: Ensure that you know and understand all the adjustments completed in Grade 10.

Learner Note: Ensure that you know and understand all the adjustments completed in Grade 10. SOLE TRADER ACCOUNTS Learner Note: Ensure that you know and understand all the adjustments completed in Grade 10. SECTION A: TYPICAL EXAM QUESTIONS HINTS Always identify the two accounts involved Classify

More information

b. Do not recognize revenue until steel is shipped. c. Do not recognize revenue until next year after the games are played.

b. Do not recognize revenue until steel is shipped. c. Do not recognize revenue until next year after the games are played. CHAPTER FOUR SE4-2 Revenue recognition a. Recognize revenue from car sales for 12,000. Notes receivable $12,000 Sales revenue $12,000 b. Do not recognize revenue until steel is shipped. c. Do not recognize

More information

AGENDA: JOB-ORDER COSTING

AGENDA: JOB-ORDER COSTING TM 3-1 AGENDA: JOB-ORDER COSTING A. The documents in a job-order costing system. 1. Materials requisition form. 2. Direct labor time ticket. 3. Job cost sheet. B. Applying overhead using a predetermined

More information

Information System. CHAPTER The Accounting. eeded: A Reliable Information System LEARNING OBJECTIVES

Information System. CHAPTER The Accounting. eeded: A Reliable Information System LEARNING OBJECTIVES 8658d_c03.qxd 11/4/02 11:11 AM Page 61 mac62 mac62:1st Shift: 3 CHAPTER The Accounting Information System eeded: A Reliable Information System N Maintaining a set of accounting records is not optional.

More information

The Accounting Cycle Completed

The Accounting Cycle Completed 5 The Accounting Cycle Completed Adjusting, Closing, and Post-Closing Trial Balance THE BIG PICTURE You are planning your school schedule for next term. Your goal is to take a full course load and find

More information

ACCOUNTING 30S WORKSHEET ON ADJUSTING ENTRIES

ACCOUNTING 30S WORKSHEET ON ADJUSTING ENTRIES ACCOUNTING 30S WORKSHEET ON ADJUSTING ENTRIES Put on your thinking caps and sharpen your pencils boys and girls it's time to practice with adjusting entries! 1. Give in general journal form the year-end

More information

ILLUSTRATION 3-1 DOUBLE-ENTRY ACCOUNTING SYSTEM

ILLUSTRATION 3-1 DOUBLE-ENTRY ACCOUNTING SYSTEM ILLUSTRATION 3-1 DOUBLE-ENTRY ACCOUNTING SYSTEM ASSETS Increase Decrease + DOUBLE-ENTRY ACCOUNTING REAL (PERMANENT) ACCOUNTS = LIABILITIES + Rules of Thumb + If the "normal balance" for an account is a

More information

NCEA Level 2 Accounting (91176) 2012 page 1 of 8. Sales 990 000 P. Cost of goods sold 586 000 P. Gross profit 404 000 S* Rent (received) 24 000 V

NCEA Level 2 Accounting (91176) 2012 page 1 of 8. Sales 990 000 P. Cost of goods sold 586 000 P. Gross profit 404 000 S* Rent (received) 24 000 V Assessment Schedule 2012 NCEA Level 2 Accounting (91176) 2012 page 1 of 8 Accounting: Prepare financial information for an entity that operates accounting subsystems (91176) Evidence Statement Question

More information

CHAPTER 4 COMPLETING THE ACCOUNTING CYCLE SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM S TAXONOMY. True-False Statements

CHAPTER 4 COMPLETING THE ACCOUNTING CYCLE SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM S TAXONOMY. True-False Statements CHAPTER 4 COMPLETING THE ACCOUNTING CYCLE SUMMARY OF QUESTIONS BY STUDY OBJECTIVES AND BLOOM S TAXONOMY Item SO BT Item SO BT Item SO BT Item SO BT Item SO BT True-False Statements 1. 1 K 9. 2 K 17. 4

More information

國 立 體 育 學 院 九 十 六 學 年 度 學 士 班 轉 學 考 試 試 題

國 立 體 育 學 院 九 十 六 學 年 度 學 士 班 轉 學 考 試 試 題 國 立 體 育 學 院 九 十 六 學 年 度 學 士 班 轉 學 考 試 試 題 會 計 學 ( 本 試 題 共 8 頁 ) 注 意 :1 答 案 一 律 寫 在 答 案 卷 上, 否 則 不 予 計 分 2 請 核 對 試 卷 准 考 證 號 碼 與 座 位 號 碼 三 者 是 否 相 符 3 試 卷 彌 封 處 不 得 汚 損 破 壞 4 行 動 電 話 或 呼 叫 器 等 通 訊 器 材 不

More information

CHAPTER 12 ACCRUALS, DEFERRALS, AND THE WORKSHEET

CHAPTER 12 ACCRUALS, DEFERRALS, AND THE WORKSHEET CHAPTER 12 ACCRUALS, DEFERRALS, AND THE WORKSHEET Chapter Opener: Thinking Critically Students may assess that an unexpected decline in sales would mean surplus inventory which would have to be reduced

More information

Accg100 Accounting 1A. Lecture Notes

Accg100 Accounting 1A. Lecture Notes Accg100 Accounting 1A Lecture Notes Semester 2, 2012 1 Table of Contents Lecture Notes Page Week 1: Introduction to Accounting, Ethics, 3 Business Entities, Financial Statements Week 2: Accounting for

More information

CHAPTER 3 Solutions MEASURING BUSINESS INCOME

CHAPTER 3 Solutions MEASURING BUSINESS INCOME CHAPTER 3 Solutions MEASURING BUSINESS INCOME Chapter 3, SE 1. 1. 2. 3. 4. c b d a Chapter 3, SE 2. Dec. 31 Insurance Expense 800 Prepaid Insurance To record insurance expired during the year $460 + $1,040

More information

Objectives and Game Plan

Objectives and Game Plan Objectives and Game Plan Understand some key concepts of Financial Accounting Appreciate the differences between cash basis and accrual accounting Develop a mental model for classifying types of accruals

More information

ACC 255 FINAL EXAM REVIEW PACKET (NEW MATERIAL)

ACC 255 FINAL EXAM REVIEW PACKET (NEW MATERIAL) Page 1 ACC 255 FINAL EXAM REVIEW PACKET (NEW MATERIAL) Complete these sample exam problems/objective questions and check your answers with the solutions at the end of the review file and identify where

More information

Accounting, CPT Chapter 6 CA PRATHAP SS

Accounting, CPT Chapter 6 CA PRATHAP SS Accounting, CPT Chapter 6 CA PRATHAP SS INTRODUCTION Preparation of Final Accounts is the last phase of the Accounting Process. INTRODUCTION The process of accounting starts from Transaction then entered

More information

Century 21 Accounting, 8e General Journal Chapter Outlines

Century 21 Accounting, 8e General Journal Chapter Outlines Century 21 Accounting, 8e General Journal Chapter Outlines PART 1 Chapter 1 ACCOUNTING FOR A SERVICE BUSINESS ORGANIZED AS A PROPRIETORSHIP Starting A Proprietorship: Changes that Affect the Accounting

More information

Accrual vs Deferral Accrual vs Cash Basis

Accrual vs Deferral Accrual vs Cash Basis 1 - Accrual vs Deferral Accrual vs Cash Basis - understanding debits and credits a transaction either increases or decreases the balance of accounts. increases and decreases in accounts are based on the

More information

YAVAPAI COLLEGE/PRESCOTT UNIFIED SCHOOL DISTRICT District Instructional Guide (DIG) Year-Long Semester Pacing Guide 2015/2016 School Year

YAVAPAI COLLEGE/PRESCOTT UNIFIED SCHOOL DISTRICT District Instructional Guide (DIG) Year-Long Semester Pacing Guide 2015/2016 School Year YAVAPAI COLLEGE/PRESCOTT UNIFIED SCHOOL DISTRICT District Instructional Guide (DIG) Year-Long Semester Pacing Guide 2015/2016 School Year School: Prescott High dual enrolled with Yavapai College Grade

More information

Gold Run Snowmobile. Adjusting Entries and Closing Entries For The Quarter Ended December 31. Final Project Evaluation. 5 th Edition.

Gold Run Snowmobile. Adjusting Entries and Closing Entries For The Quarter Ended December 31. Final Project Evaluation. 5 th Edition. Gold Run Snowmobile 5 th Edition Adjusting Entries and Closing Entries For The Quarter Ended December 31 and the Final Project Evaluation Page 1 ADJUSTING ENTRIES FOR THE QUARTER Using a copy of the December

More information

Completing the Accounting Cycle

Completing the Accounting Cycle Chapter 9 Completing the Accounting Cycle ANSWERS TO SECTION 9.1 REVIEW QUESTIONS (text p. 307) The Adjustment Process 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 218 Accounting 1 Student

More information

The Accounting Cycle Completed

The Accounting Cycle Completed 5 The Accounting Cycle Completed T HE B IG P ICTURE Accountants have come a long way from the old stereotype of bean counter a pale figure with a green eyeshade who tends cloth-bound ledgers and journals

More information

Vol. 1, Chapter 7 The Statement of Cash Flows

Vol. 1, Chapter 7 The Statement of Cash Flows Vol. 1, Chapter 7 The Statement of Cash Flows Problem 1: Solution Transaction # Identification 1 Operating 2 Investing 3 Noncash transaction 4 Financing 5 Noncash transaction 6 Operating 7 Investing 8

More information

CHAPTER 3. BE3-2 Advertising. Dec. 31 Advertising Supplies Expense 7200 Advertising Supplies 7200 to adjust. BE3-3 Bere Co.

CHAPTER 3. BE3-2 Advertising. Dec. 31 Advertising Supplies Expense 7200 Advertising Supplies 7200 to adjust. BE3-3 Bere Co. CHAPTER 3 BE3-2 Advertising Advertising Supplies Supplies Expense 8700 7200 7200 1500 7200 Dec. Advertising Supplies Expense 7200 Advertising Supplies 7200 BE3-3 Bere Co. Prepaid Insurance Insurance Expense

More information

A = L + OE. Transaction 1 Assets = Liabilitites + Owners equity + 1,000,000 Cash + 1,000,000 Common stock

A = L + OE. Transaction 1 Assets = Liabilitites + Owners equity + 1,000,000 Cash + 1,000,000 Common stock FINANCIAL STATEMENT ANALYSIS Henry Jarva Aalto University, Spring 2015 Student name: EXERCISE 1. Provide journal entries for Transactions 5 8, Adjusting Entries 2 7, and prepare Exhibit 1. 2. Calculate

More information

The Measurement of the Business Income. 1 by recording revenues when earned and expenses when incurred. 2 by adjusting accounts

The Measurement of the Business Income. 1 by recording revenues when earned and expenses when incurred. 2 by adjusting accounts Recap from Week 3 The Measurement of the Business Income The primary objective of accounting is measuring the net income of the businesses according to the generally accepted accounting principles. Net

More information

Veideretti Cabinets, Incorporated

Veideretti Cabinets, Incorporated Veideretti Cabinets, Incorporated 2 nd Web-Based Edition Transactions for June 24-30, And the June 30 th Bank Reconciliation Page 1 TRANSACTIONS FOR JUNE 24-26 June 24: Paying an expense A $120 check (30429)

More information

Student Solutions Manual to Accompany. Introduction to Financial Accounting. David Annand. Based on International Financial Reporting Standards

Student Solutions Manual to Accompany. Introduction to Financial Accounting. David Annand. Based on International Financial Reporting Standards Student Solutions Manual to Accompany Introduction to Financial Accounting Based on International Financial Reporting Standards David Annand Copyright 2014 David Annand Published by David Annand 4910C

More information

'i*,; V' Your answer is correct! Match the Item on the left wlth the definition on the rtght.

'i*,; V' Your answer is correct! Match the Item on the left wlth the definition on the rtght. Match the Item on the left wlth the definition on the rtght. V' Your answer is correct! ~ Income statement """' ~ Reports a business's revenues and expenses for a period of time. ~ Balance sheet 1rt1 ~

More information

BUSINESS BOOKS. Accounting SIXTH EDITION. Peter J. Eisen Assistant Principal Retired Accounting & Business Practice N.YC. Department of Education

BUSINESS BOOKS. Accounting SIXTH EDITION. Peter J. Eisen Assistant Principal Retired Accounting & Business Practice N.YC. Department of Education BUSINESS BOOKS Accounting SIXTH EDITION Peter J. Eisen Assistant Principal Retired Accounting & Business Practice N.YC. Department of Education BARRON'S CONTENTS Preface ix 1 THE ACCOUNTING EQUATION I

More information

Assignment 6: Adjusting Journal Entries and

Assignment 6: Adjusting Journal Entries and Name: Due Date: December 12, 2011 Score: out of a possible 47 Course value: 7.5% Assignment 6: Adjusting Journal Entries and Worksheets A series of transactions are presented and their journal entries

More information

Adjusting Accounts and Preparing Financial Statements

Adjusting Accounts and Preparing Financial Statements wil79549_ch03_0090-0133 07/30/2008 5:36 pm Page 90 pinnacle 201:MHBR055:mhwiL19:wiL19ch03: A Look Back Chapter 2 explained the analysis and recording of transactions. We showed how to apply and interpret

More information

SECTION 8.1 REVIEW QUESTIONS (page 275)

SECTION 8.1 REVIEW QUESTIONS (page 275) CHAPTER 8 Completing the Accounting Cycle SECTION 8.1 REVIEW QUESTIONS (page 275) 1. Year-end financial statements are superior to interim financial statements because all accounts are brought up to date,

More information

PROFESSOR S NAME ACC 255 FALL 2011 COVER SHEET FOR COMPREHENSIVE PROBLEM 2 (CHAPTERS 2, 5-8)

PROFESSOR S NAME ACC 255 FALL 2011 COVER SHEET FOR COMPREHENSIVE PROBLEM 2 (CHAPTERS 2, 5-8) COMPREHENSIVE PROBLEM 2 (CHAPTERS 2, 5-8) Page 137 NAME ANSWER KEY PROFESSOR S NAME SECTION SCORE ACC 255 FALL 2011 COVER SHEET FOR COMPREHENSIVE PROBLEM 2 (CHAPTERS 2, 5-8) INSTRUCTIONS: COMPLETE ALL

More information

Module 3: Adjusting the accounts, preparing the statements, and completing the accounting cycle

Module 3: Adjusting the accounts, preparing the statements, and completing the accounting cycle Page 1 of 27 Module 3: Adjusting the accounts, preparing the statements, and completing the accounting cycle Overview In Module 2 you studied the fundamental steps in recording accounting information by

More information

Chapter 5: Adjustments and the Worksheet

Chapter 5: Adjustments and the Worksheet Chapter 5: Adjustments and the Worksheet Chapter Opener: Thinking Critically Students should suggest that accountants estimate the amount of wear and tear on the equipment. This expense should be charged

More information

Accrual Accounting and the Financial Statements

Accrual Accounting and the Financial Statements Accrual Accounting and the Financial Statements 3 LEARNING OBJECTIVES SPOTLIGHT Le Château has been selling fashion apparel, footwear, and accessories in Canada for over 50 years. What started as a single,

More information

ACCRUAL ACCOUNTING CONCEPTS

ACCRUAL ACCOUNTING CONCEPTS c04accrualaccountingconcepts.qxd 8/3/10 1:50 PM Page 162 chapter 4 ACCRUAL ACCOUNTING CONCEPTS 162 the navigator Scan Study Objectives Read Feature Story Scan Preview Read Text and Answer Do it! p. 175

More information