会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements.ppt

AdjustingAccountsandPreparingFinancialStatements Chapter3 TheAccountingPeriod C1 Accounting AccrualBasisversusCashBasis AccrualBasisRevenuesarerecognizedwhenearnedandexpensesarerecognizedwhenincurred CashBasisRevenuesarerecognizedwhencashisreceivedandexpensesarerecordedwhencashispaid C2 CashBasisRevenuesarerecognizedwhencashisreceivedandexpensesarerecordedwhencashispaid Accounting AccrualBasisversusCashBasis C2 AccrualBasisRevenuesarerecognizedwhenearnedandexpensesarerecognizedwhenincurred AccrualBasisversusCashBasis OnDecember1 2013 FastForwardpaid 2 400cashforatwenty fourmonthbusinessinsurancepolicy Usingthecashbasis theentire 2 400wouldberecognizedasinsuranceexpensein2013 Noinsuranceexpensefromthispolicywouldberecognizedin2014or2015 periodscoveredbythepolicy C2 AccrualBasisversusCashBasis Ontheaccrualbasis 100ofinsuranceexpenseisrecognizedin2013 1 200in2014 and 1 100in2015 Theexpenseismatchedwiththeperiodsbenefitedbytheinsurancecoverage C2 Wehavedeliveredtheproducttoourcustomer soIthinkweshouldrecordtherevenueearned RecognizingRevenuesandExpenses C2 Therevenuerecognitionprinciplestatesthatwerecognizerevenuewhentheproductorserviceisdeliveredtoourcustomer RecognizingRevenuesandExpenses Theexpenserecognition ormatching principleaimstorecordexpensesinthesameaccountingperiodastherevenuesthatareearnedasaresultofthoseexpenses Thismatchingofexpenseswiththerevenuebenefitsisamajorpartoftheadjustingprocess Nowthatwehaverecognizedtherevenue let sseewhatexpensesweincurredtogeneratethatrevenue C2 Anadjustingentryisrecordedtobringanassetorliabilityaccountbalancetoitsproperamount FrameworkforAdjustments C3 Hereisthecheckformy24 monthinsurancepolicy Prepaid Deferred Expenses Resourcespaidforpriortoreceivingtheactualbenefits P1 PrepaidInsurance a On12 1 13 FastForwardpaid 2 400forinsurancefor2 years 24 months December2013throughNovember2015 FastForwardrecordedtheexpenditureasPrepaidInsuranceon12 1 13 Whatadjustmentisrequired P1 Supplies b During2013 FastForwardpurchased 9 720ofsupplies FastForwardrecordedtheexpendituresintheassetaccount Supplies OnDecember31 2013 acountofthesuppliesindicated 8 670onhand so 1 050ofsupplieswereusedduringDecember Whatadjustmentisrequired P1 OtherPrepaidExpenses Otherprepaidexpenses suchasPrepaidRent areaccountedforexactlyasInsuranceandSupplies Weshouldnotethatsomeprepaidexpensesarebothpaidforandfullyusedupwithinasingleperiod Forexample acompanymaypaymonthlyrentonthefirstdayofeachmonth Thispaymentcreatesaprepaidexpenseonthefirstdayofthemonththatfullyexpiresbytheendofthemonth Inthesespecialcases wecanrecordthecashpaidwithadebittotheexpenseaccountinsteadofanassetaccount P1 Depreciation Depreciationistheprocessofallocatingthecostofaplantassetoveritsusefullifeinasystematicandrationalmanner P1 Depreciation OnDecember1 2013 FastForwardpurchasedequipmentfor 26 000cash Theequipmenthasanestimatedusefullifeoffouryears 48months andFastForwardexpectstoselltheequipmentattheendofitslifefor 8 000cash c Let srecorddepreciationexpenseforthemonthendedDecember31 2013 P1 Equipment DepreciationExpense 12 126 000 12 31375 AccumulatedDepreciation 12 31375 Depreciation P1 Contraassetaccount Equipmentisshownnetofaccumulateddepreciation Depreciation P1 Unearned Deferred Revenues Wewillapplythiscashyougaveustowardsyourtotalconsultingfees Cashreceivedinadvanceofprovidingproductsorservices P1 Unearned Deferred Revenues OnDecember26 2013 FastForwardagreestoprovideconsultingservicestoaclientforafixedfeeof 3 000for60days Onthisdate theclientpaystheentireconsultingfeeinadvance FastForwardmakesthefollowingentry P1 Unearned Deferred Revenues d OnDecember31 FastForwardearns5 daysofconsultingfees Eachdaythatpassesresultsinconsultingfeesof 50 3 000 60 soFastForwardearned 50 5days 250 P1 We reaboutone halfdonewiththisjobandwanttobepaidforourwork Costsincurredinaperiodthatarebothunpaidandunrecorded AccruedExpenses P1 FastForward semployeeearns 70perdayandispaideverytwoweeksonFriday Year end 12 31 13 fallsonaWednesday Thelastpaydayof2013isFriday 12 26 13 From12 26untilyear endisthreeworkingdays Theemployeehasearned 210forMondaythroughWednesday HewillnotbepaiduntilFriday1 9 14 AccruedSalariesExpenses P1 e FastForward semployeehasearnedbutnotbeenpaidonDecember31 2013 210 P1 AccruedSalariesExpenses FuturePaymentofAccruedExpenses OnJanuary9 2014 FastForwardwillpaythepayrollforthetwoweeksfromDecember26 2013throughJanuary9 2014 Hereisthejournalentryforthepayroll P1 AccruedInterestExpenses FastForwardborrowed 6 000fromFirstNationalBankonDecember1 2013 Thenotebearsinterestattheannualrateof6 andisduetoberepaidinoneyear Let saccrueinterestforthemonthendedDecember31 2013 P1 Yes I vecompletedyourconsultingjob buthavenothadtimetobillyou AccruedRevenues Revenuesearnedinaperiodthatarebothunrecordedandnotyetreceived P1 AccruedServiceRevenue f OnDecember12 2013 FastForwardagreestorenderconsultingservicesundera30 dayfixedfeecontractfor 2 700 90perday AllservicesaretobecompletedbyJanuary10 2014 whentheclientwillpayinfull P1 FutureReceiptofServiceRevenues OnJanuary10 2014 FastForwardcompleteditsobligationundertheconsultingcontract Theclientwasbilled 2 700andFastForwardreceived 2 700incash RevenueinJanuary10days 90 900 P1 LinkstoFinancialStatements A1 P2 PreparingFinancialStatements Let suseFastForward sadjustedtrialbalancetopreparethecompany sfinancialstatements P3 P3 1 PreparetheIncomeStatement Note NetIncomefromtheIncomeStatementcarriestotheStatementofChangesinOwner sEquity P3 2 PreparetheStatementofOwner sEquity a 3 PrepareTheBalanceSheet P3 GlobalView BothU S GAAPandIFRSincludesimilarguidanceforadjustingaccounts Althoughsomevariationsexistinrevenuea