Module2财务会计入门英.pptx

The Recording Process,Learning Objectives,Explain what an account is and how it helps in the recording process. Define debits and credits and explain how they are used to record accounting transactions. Explain what a journal is and how it helps in the recording process. Explain what a general ledger is and how it helps in the recording process. Explain what posting is and how it helps in the recording process. Explain the purpose and limitations of a trial balance.,Event Analysis Summary (Review),An economic event is analysed. If recognised, the event will be two-sided, affecting assets, liabilities and/or equity. Before, during, and after recognition, there is equality in terms of the accounting equation,Record of increases and decreases in a specific asset, liability, equity, income, or expense item.,Account,An Account can be illustrated in a T-Account form.,LO 1: The Account,Debit = “Left” Credit = “Right”,If Debits are greater than Credits, the account will have a debit balance.,$10,000,Transaction #2,$3,000,$15,000,8,000,Transaction #3,Balance,Transaction #1,LO 1: The Account,If Credits are greater than Debits, the account will have a credit balance.,$10,000,Transaction #2,$3,000,Balance,Transaction #1,LO 1: The Account,$1,000,8,000,Transaction #3,Double entry system: Each recordable event affects at least two accounts. The increase or decrease to an account is recorded with a debit or a credit, depending on the account. For each recordable event, total dollar debits must equal total dollar credits.,LO 2: Debits and Credits,Rules of double entry bookkeeping: A = L + OE A = L + Share Capital + Income Expenses Dividends Assets are on the left, so increase them with debits. Liabilities and equity are on the right, so increase them with credits. Equity is increased with share capital and income (including revenues), so increase these accounts with credits. But expenses and the “Dividends” account decrease equity, so increase these accounts with debits.,LO 2: Debits and Credits,Normal Balance Credit,Normal Balance Debit,LO 2: Debits and Credits,Issuance of share capital, reserves, and income increase equity (credit). Dividends and expenses decrease equity (debit).,LO 2: Debits and Credits,What is the “normal” balance of each of the following accounts? Advertising Expense. Dividend Revenue. Dividends Receivable. Share Capital. Dividends. Dividends Payable.,LO 2: Debits and Credits CreditsBE2-1, p. 78 (adapted),Debits: increase both assets and liabilities. decrease both assets and liabilities. increase assets and decrease liabilities. decrease assets and increase liabilities.,Review Question,LO 2: Debits and Credits Summary,Debits: increase both assets and liabilities. decrease both assets and liabilities. increase assets and decrease liabilities. decrease assets and increase liabilities.,Business documents, such as an invoice, a cheque, or a cash register tape, provide evidence of a recordable event. Journal = book of original entry. Events are recorded in the journal in chronological order. Journals contributions to the recording process: Discloses the complete effects of an event. Provides a chronological record. Helps to prevent or locate errors because the debit and credit amounts can be easily compared.,LO 3: Journalising,For each part of a recordable event, first determine the appropriate account affected (conceptual framework/residual analysis), then apply the rules of debit and credit: 1. The _ account has incr/decr, which incr/decr A,L, or OE. 2. An incr/decr to A,L, or OE is recorded with a DR/CR. 3. Therefore, DR/CR the _ account.,LO 3: Journalising,Share capital,Journalizing Simple journal entries.,On September 1, stockholders invested $15,000 cash in exchange for ordinary shares, and Softbyte purchased computer equipment for $7,000 cash.,Cash,Sept. 1,15,000,15,000,General Journal,Computer equipment,Cash,7,000,7,000,Illustration 2-14,LO 3: Journalising,8,000,Delivery equipment,Cash,14,000,6,000,Accounts payable,Sept. 1,On July 1, Butler Company purchased a delivery truck costing $14,000. It paid $8,000 cash and agreed to pay the remaining $6,000 on account.,General Journal,Illustration 2-15,Compound Journal Entry,LO 3: Journalising,LO 3: Journalising BE2-5, p. 79 (adapted),General Ledger Contains all accounts maintained by a business. All asset, liability, equity, income and expense accounts.,LO 4: The Ledger,Illustration 2-16,LO 4: The Ledger,Illustration 2-18,Chart of Accounts,T-account form used in accounting textbooks. Ledger form used in practice.,Illustration 2-17,LO 4: The Ledger,Standard Form of Account,Posting the process of transferring amounts from the journal to the ledger accounts.,Illustration 2-19,LO 5: Posting,Posting: normally occurs before journalizing. transfers ledger transaction data to the journal. is an optional step in the recording process. transfers journal entries to ledger accounts.,Review Question,LO 5: Posting,Posting: normally occurs before journalising. transfers ledger transaction data to the journal. is an optional step in the recording process. transfers journal entries to ledger accounts.,Katherine Turner recorded the following transactions during the month of March.,LO 5: Posting,Post these entries to the Cash account.,A list of accounts and their balances at a given time. Purpose is to prove that debits equal credits.,LO 6: The Trial Balance,Illustration 2-32,The accounts come from the ledger of Christel Ltd at December 31, 2011.,LO 6: The Trial Balance,Christel Ltd Trial Balance (in thousands) December 31, 2011,LO 6: The Trial Balance E2-9, p. 82,LO 6: The Trial BalanceE2-9, p. 82,TERESA GONZALEZ, INVESTMENT BROKER Trial Balance August 31, 2011 Debit Credit Cash $7,300 Accounts Receivable Office Equipment Notes Payable Share CapitalOrdinary Service Revenue 4,000 $13,000 $13,000,LO 6: The Trial BalanceE2-9, p. 82,The trial balance may balance even when a transaction is not journalized, a correct journal entry is not posted, a journal entry is posted twice, incorrect accounts are used in journalizing or posting, or offsetting errors are made in recording the amount of a transaction.,LO 6: The Trial Balance,Limitations of a Trial Balance,A bookkeeper made these errors in journalising and posting: 1. A credit posting of $400 to Accounts Receivable was omitted. 2. A debit posting of $750 for Prepaid Insuranc