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

1、会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Adjusting Accounts and Preparing Financial Statements,Chapter 3,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,The Accounting Period,C 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial St

2、atements,Accounting,Accrual Basis versus Cash Basis,Accrual Basis Revenues are recognized when earned and expenses are recognized when incurred.,Cash Basis Revenues are recognized when cash is received and expenses are recorded when cash is paid.,C 2,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Prepari

3、ng Financial Statements,Cash Basis Revenues are recognized when cash is received and expenses are recorded when cash is paid.,Accounting,Accrual Basis versus Cash Basis,C 2,Accrual Basis Revenues are recognized when earned and expenses are recognized when incurred.,会计学原理 英文版 第21版 第三章 Adjusting Accou

4、nts and Preparing Financial Statements,Accrual Basis versus Cash Basis,On December 1, 2013, FastForward paid $2,400 cash for a twenty-four month business insurance policy. Using the cash basis, the entire $2,400 would be recognized as insurance expense in 2013. No insurance expense from this policy

5、would be recognized in 2014 or 2015, periods covered by the policy.,C 2,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Accrual Basis versus Cash Basis,On the accrual basis, $100 of insurance expense is recognized in 2013, $1,200 in 2014, and $1,100 in 2015. The expense is m

6、atched with the periods benefited by the insurance coverage.,C 2,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,We have delivered the product to our customer, so I think we should record the revenue earned.,Recognizing Revenues and Expenses,C 2,The revenue recognition princ

7、iple states that we recognize revenue when the product or service is delivered to our customer.,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Recognizing Revenues and Expenses,The expense recognition (or matching) principle aims to record expenses in the same accounting pe

8、riod as the revenues that are earned as a result of those expenses. This matching of expenses with the revenue benefits is a major part of the adjusting process.,Now that we have recognized the revenue, lets see what expenses we incurred to generate that revenue.,C 2,会计学原理 英文版 第21版 第三章 Adjusting Acc

9、ounts and Preparing Financial Statements,An adjusting entry is recorded to bring an asset or liability account balance to its proper amount.,Framework for Adjustments,C 3,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Here is the check for my 24-monthinsurance policy.,Prepa

10、id (Deferred) Expenses,Resources paid for prior to receiving the actual benefits.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Prepaid Insurance,(a) On 12/1/13, FastForward paid $2,400 for insurance for 2-years (24-months, December 2013 through November 2015). FastFor

11、ward recorded the expenditure as Prepaid Insurance on 12/1/13. What adjustment is required?,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Supplies,(b) During 2013, FastForward purchased $9,720 of supplies. FastForward recorded the expenditures in the asset account, “Su

12、pplies.” On December 31, 2013, a count of the supplies indicated $8,670 on hand, so $1,050 of supplies were used during December. What adjustment is required?,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Other Prepaid Expenses,Other prepaid expenses, such as Prepaid R

13、ent, are accounted for exactly as Insurance and Supplies. We should note that some prepaid expenses are both paid for and fully used up within a single period. For example, a company may pay monthly rent on the first day of each month. This payment creates a prepaid expense on the first day of the m

14、onth that fully expires by the end of the month. In these special cases, we can record the cash paid with a debit to the expense account instead of an asset account.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Depreciation,Depreciation is the process of allocating th

15、e cost of a plant asset over its useful life in a systematic and rational manner.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Depreciation,On December 1, 2013, FastForward purchased equipment for $26,000 cash. The equipment has an estimated useful life of four years

16、(48 months) and FastForward expects to sell the equipment at the end of its life for $8,000 cash. (c) Lets record depreciation expense for the month ended December 31, 2013.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Equipment,Depreciation Expense,12/1 26,000,12/31

17、375,Accumulated Depreciation,12/31 375,Depreciation,P 1,Contra asset account,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Equipment is shown net of accumulated depreciation.,$,Depreciation,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Unearn

18、ed (Deferred)Revenues,We will apply this cash you gave us towardsyour total consulting fees.,Cash received in advance of providing products or services.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Unearned (Deferred)Revenues,On December 26, 2013, FastForward agrees t

19、o provide consulting services to a client for a fixed fee of $3,000 for 60 days. On this date, the client pays the entire consulting fee in advance. FastForward makes the following entry:,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Unearned (Deferred)Revenues,(d) On

20、December 31, FastForward earns 5-days of consulting fees. Each day that passes results in consulting fees of $50 ($3,000 60), so FastForward earned ($50 5 days) $250.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Were about one-half done with this job and want to be pa

21、id forour work!,Costs incurred in a period that are both unpaid and unrecorded.,Accrued Expenses,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,FastForwards employee earns $70 per day and is paid every two weeks on Friday. Year-end, 12/31/13, falls on a Wednesday. The l

22、ast payday of 2013 is Friday, 12/26/13. From 12/26 until year-end is three working days. The employee has earned $210 for Monday through Wednesday. He will not be paid until Friday 1/9/14.,Accrued Salaries Expenses,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,(e) Fast

23、Forwards employee has earned but not been paid on December 31, 2013, $210.,P 1,Accrued Salaries Expenses,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Future Payment ofAccrued Expenses,On January 9, 2014, FastForward will pay the payroll for the two weeks from December 26,

24、 2013 through January 9, 2014. Here is the journal entry for the payroll:,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Accrued Interest Expenses,FastForward borrowed $6,000 from First National Bank on December 1, 2013. The note bears interest at the annual rate of 6%

25、and is due to be repaid in one year. Lets accrue interest for the month ended December 31, 2013.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Yes, Ive completed yourconsulting job, but have not had time to bill you.,Accrued Revenues,Revenues earned in a period that ar

26、e both unrecorded and not yet received.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Accrued Service Revenue,(f) On December 12, 2013, FastForward agrees to render consulting services under a 30-day fixed fee contract for $2,700 ($90 per day). All services are to be c

27、ompleted by January 10, 2014, when the client will pay in full.,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Future Receipt ofService Revenues,On January 10, 2014, FastForward completed its obligation under the consulting contract. The client was billed $2,700 and Fas

28、tForward received $2,700 in cash.,Revenue in January 10 days $90 = $900,P 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Links to Financial Statements,A 1,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,P 2,会计学原理 英文版 第21版 第三章 Adjusting Accounts an

29、d Preparing Financial Statements,Preparing Financial Statements,Lets use FastForwards adjusted trial balance to prepare the companys financial statements.,P 3,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,P 3,1. Prepare the Income Statement,会计学原理 英文版 第21版 第三章 Adjusting Acc

30、ounts and Preparing Financial Statements,Note: Net Income from the Income Statement carries to the Statement of Changes in Owners Equity.,P 3,2. Prepare the Statement of Owners Equity,a,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,3. Prepare The Balance Sheet,P 3,会计学原理 英文

31、版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Global View,Both U.S. GAAP and IFRS include similar guidance for adjusting accounts. Although some variations exist in revenue and expense recognition.,会计学原理 英文版 第21版 第三章 Adjusting Accounts and Preparing Financial Statements,Profit Margin,The profit margin ratio measures the companys net income to net sales.,Profit Margin,=,A 2,Limited Brands, Inc.,N