Tires

Tires
Information Systems
areers in Accounting
A Career in Information Systems
Have you ever heard the sayings "knowledge is power" or "information is money"? When people
talk about accounting, what they are really talking about is information. The information used by
businesses, as well as the technology that supports that information, represents some of the most
valuable assets for organizations around the world. Very often, the success of a business depends on
effective creation, management, and use of information. As companies become ever more reliant on
technology, the need for welleducated Management Information Systems (MIS) auditors and control
professionals increases. Improved technology has the potential to dramatically improve ... Show
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Usually, they save these work sheets to
(continued)
133
134
PART II
Processing Information for Decisions and Establishing Accounting Policy
Objectives
7. Prepare a classified balance sheet. 8. Analyze and use the financial results–the current ratio.
Objective 1 Summarize the steps in the accounting cycle.
document the end–of–period entries. A work sheet is only an accounting tool and not part of the
formal accounting records. Therefore, work sheets may vary in format; some are prepared in pencil
so that errors can be corrected easily. Other work sheets are prepared on personal computers with
spreadsheet software. Accountants prepare work sheets each time financial statements are needed–
monthly, quarterly, or at the end of the accounting year. This chapter illustrates a 12–column work
sheet that includes sets of columns for an unadjusted trial balance, adjustments, adjusted trial
balance, income statement, statement of retained earnings, and balance sheet. Each set has a debit

and a credit column. (See Illustration 4.2 on page 136.) Accountants use these initial steps in
preparing the work sheet. The following sections describe the detailed steps for completing the work
sheet. 1. 2. 3. 4. Enter the titles and balances of ledger
... Get more on HelpWriting.net ...

Accounting Midterm Essay
ACCT112 Midterm Assignment – Week 9 Due at the end of week 9. There are 70 marks. This
assignment is worth 20 % of the total grade. True or False: (15 Marks) 1. In spite of its weaknesses,
the cost principle is most often used because it is the most reliable basis of valuation. TRUE 2. The
going concern assumption assumes the company will continue to operate for at least two years.
TRUE 3. The economic entity assumption states that economic events can be identified with a
particular unit of accountability. FALSE 4. The monetary unit assumption states that transactions
that can be measured in terms of money should be recorded in the accounting records. TRUE 5. The
drawings account is a subdivision of ... Show more content on Helpwriting.net ...
d. Debit a revenue account for $500. 9. A furniture factory's employees work overtime to finish an
order that is sold on February 28. The office sends a statement to the customer in early March and
payment is received by mid–March. The overtime wages should be expensed in a. February. b.
March. c. the period when the workers receive their cheques. d. either in February or March
depending on when the pay period ends. 10. Jacob's Company has a June 30 year end. On June 28,
Jacob's provided consulting services to Jennings Company. Jacob's billed Jennings on July 2 for
$800 related to these services. On July 5, Jennings paid the invoice in full. Jacob's only cost related
to this sale was $250 in salaries expense. Jacob's paid the salaries on July 3. Assuming Jacob's
Company has a June 30 year end, the company's profit for the Jennings' job on the June 30 financial
statements should be a. 0. b. $800. c. $550. d. $250. 11. Under the accrual basis of accounting a.
cash must be received before revenue is recognized. b. net income is calculated by matching cash
outflows against cash inflows. c. events that change a company's financial statements are recognized
in the period they occur rather than in the period in which cash is paid or received. d. the ledger
accounts must be adjusted to reflect a cash basis of accounting before financial statements are
prepared under generally accepted accounting

Paciolo and Modern Accounting
* First bookkeeping book printed in 1494 – very little change to bookkeeping * Since emergence of
record keeping similar to banks and governments were applied to mercantile affairs, bookkeeping
has possessed theory, form, and technology * Ancient theory in bookkeeping was inferred * Double
entry arose from a certain methodology – double posting passed the test of mechanical accuracy. It
is a fact that every transaction has dual aspect * System of debits and credits was used in ancient
times – rise of proprietor and proprietorship allowed use of all financial elements of trade rather than
just a system of record keeping * Paciolo showed no theory behind the 'canceling out' of debits and
credits and the journal entry ... Show more content on Helpwriting.net ...
ents that could not be kept track of one by one, and also recommended separate accounting for a
shop 'outside your house' as a means to monitor financial activity Differences * Lacked accounting
theory – bookkeeping in ancient times was a means of recording procedure, and no explanation as to
why one does these was needed * Ledger account has become more simplified, journal entries
replaced phrases with position * Simple records no longer satisfactory due to businesses growing in
size and complexity – within last one hundred years refinements of theory have been added, but
bookkeeping as a whole is fairly unchanged * Paciolo has no provision for financial statements,
probably due to simplicity of merchant transactions – having accurate records of profit and loss was
sufficient * This also means there were no periodical closing, periodical inventories, etc *
Accounting theory followed the development of business (need for financial statements) * Ancients
viewed business as disjointed transactions – today it is regarded as a continuous process; today we
use terms like income and earnings, rather than profits * Cost accounting was non existent until
modern times; ancient times also placed less relevance on fixed assets and wages * Mercantile
expenses included household expenses, as well as gambling expenses and stolen or lost money
Conclusion * Capital and revenue expenditures grew out of our desire to determine net

Ch 3 Review
Chapter 3 (REVIEW–Self study chapter)
After studying this chapter, you should be able to:
Understand basic accounting terminology.
Explain double–entry rules.
Explain how transactions affect the accounting equation.
Identify the steps in the accounting cycle and the steps in the recording process.
Explain the reasons for and prepare adjusting entries.
Explain how the type of ownership structure affects the financial statements.
Prepare closing entries and consider other matters relating to the closing process.
Prepare a 10–column work sheet and financial statements.
After studying Appendix 3A, you should be able to:
Identify adjusting entries that may be reversed.
THE ACCOUNTING INFORMATION SYSTEM
The Accounting ... Show more content on Helpwriting.net ...
Analyse the transaction 2. Journalize the transaction 3. Post the transaction to general ledger (and
sub–ledgers) accounts 4. Prepare the (unadjusted) trial balance 5. Prepare necessary adjusting
journal entries 6. Prepare the (adjusted) trial balance 7. Prepare financial statements 8. Prepare
closing journal entries for the year 9. Prepare post–closing trial balance (optional) 10. Prepare
reversing entries (optional)
Recording a Transaction:
Shares are issued for $3,000 cash
DR. cash $3000 CR. Common shares $3000
Preparation of Trial Balance
Preparation of Trial Balance (look @ ppt)
From the

The Characteristics Of Ancient Accounting
Ancient accounting started way back during the ancient civilization. However, double–entry
bookkeeping started in the 14th century in Italy. The Italians of the 14th to 16th century were the
first to practice the use of Arabic, rather than Roman, numerals for tracking business accounts. Luca
Pacioli was acknowledged as the Father of Accounting and Bookkeeping. However, he was not the
one who invented the double–entry bookkeeping system but he was the one who started to spread
this knowledge and the first to publish his work on this system. The principles published by him
remain mostly unchanged until today. Before his work, Benedetto Cotrugli wrote Delia Mercatura et
del Mercante Perfetto (Of Trading and the Perfect Trader), that touches briefly about the features of
double entry bookkeeping. Although the work of Benedetto Cotrugli had not been published for
more than a century, Pacioli was familiar with the manuscript and he credited Cotrugli as the creator
of the ... Show more content on Helpwriting.net ...
The memorandum, or memorial, was for recording business transactions in chronological order. The
journal acts as the merchant's private account book whereby the entries consisted of a narrative
debit, credit and explanation in one continuous paragraph. As for the journal, it had only one column
which was not totaled. There were no compound entries. The ledger was the most identical to those
in modern ledgers. The money and date columns were almost identical to those in modern ledgers,
with entries consisting of brief paragraphs, debits on the left and credits on the right. He also
demonstrated on the year–end closing entries and proposed the usage of trial balance as a proof that
the ledger is balanced. It is the end of Pacioli's accounting cycle. Credited amount from the old
ledger are listed on the right side while debited amount on the left of the balance sheet. If both
amounts are equal, it means that the ledger is

MULTIPLE CHOICE
MULTIPLE CHOICE
1. The owner's equity in a business amounted to $56,000 at the beginning of the year and $100,000
at the end of the year. The owner had made no additional investments and had withdrawn $19,000
during the year. The net income for the year amounted to
a.
$76,000.
b.
$67,000.
c.
$63,000.
d.
$188,000.
ANS: C DIF: Medium OBJ: LO 6–1 MSC: AACSB Analytic
4. Changes in owner's equity that result from investments or withdrawals of assets by the owner are
included in the
a.
statement of owner's equity.
b.
income statement.
c.
balance sheet.
d.
chart of accounts.
ANS: A DIF: Easy OBJ: LO 6–1 MSC: AACSB Communication
5. Owner's equity can be increased through
a.
withdrawals by the owner.
b.
investments by the owner.
c. ... Show more content on Helpwriting.net ...

ANS: A DIF: Easy OBJ: LO 6–2 MSC: AACSB Communication
18. Which step is taken at the end of the accounting period?
a.
analyze source documents
b.
post to the general ledger accounts
c.
prepare a trial balance
d.
prepare a post–closing trial balance
ANS: D DIF: Easy OBJ: LO 6–4 MSC: AACSB Communication
19. Which of the following steps of the accounting cycle are in the correct order?
a.
prepare a trial balance, post to general ledger accounts, journalize adjusting and closing entries
b.
make adjustments, complete a work sheet, post to general ledger accounts
c.
prepare financial statements, make adjustments, prepare a trial balance
d.
prepare a trial balance, make adjustments, prepare financial statements
20. The journal entry to close the income summary account (showing a profit) includes
a.
debiting the drawing account and crediting Income Summary.
b.
debiting Income Summary and crediting the drawing account.
c.
debiting the owner's capital account and crediting Income Summary.
d.
debiting Income Summary and crediting the owner's capital account.
21. What is the correct sequence for closing the temporary accounts?
a.
revenue accounts, expense accounts, Income Summary, drawing account
b.
expense accounts, revenue accounts, Income Summary, drawing account
c.
revenue accounts, expense accounts, drawing account,

Importance Of Finance As A Decision Making Tool Within...
The following report will justify the use and importance of finance as a decision making tool within
organisational contexts. In addition, an application of basic financial techniques will be present in
order to analyse the performance of an organisation in 2012 to their performance in 2013.
2.0 Justification of finance as a decision making tool
Within organisations, the justification of finance in regards to a decision making tool is critical.
2.1Double–Entry Bookkeeping
Within an organisation, bookkeeping is simply a form of recording financial transactions. Dyson
(2007)asserts bookkeeping is critical, postulating "bookkeeping may be regarded as the foundation
on which the entire discipline of accounting is built". It is critical ... Show more content on
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The two aspects are acknowledged as debits and credits. Mott (2007)
2.11 Single–Entry Bookkeeping
Alternatively, organisations not using double–entry bookkeeping will use single–entry bookkeeping.
Single–entry differs from double–entry by not following the "dual aspect rule, with Hanif
(2013)stating "transactions are not recorded in their two–fold aspects". There are limitations of
single–entry bookkeeping in comparison to double–entry bookkeeping. Hanif (2013) Fleay et al
(2011) Ahmed (2008) Mukherjee and Hanif (2006)postulate that due to single–entry bookkeeping
not acknowledging nominal accounts, this results in the "trading and profit and loss account cannot
be prepared". Additionally, single–entry bookkeeping does not have set rules that double–entry
bookkeeping has, resulting in potential confusion. Additionally, employers integrating double–entry
bookkeeping into their business in comparison to single–entry are able to make better decisions,
signifying the critical importance of double–entry bookkeeping, in regards to benefiting employers,
guiding them to make better, informed decisions.
2.2 Trial Balance
Kimuda (2008)defines trial balance as "a schedule of balance, both credit and debit, extracted from
the accounts in the ledger". In addition, Rich et al (2012)asserts a trial balance explicitly states
active accounts and the debit and credit balance of each account. Additionally postulating trial
balances

Analyse Key Elements
1. Identify: I would list our key elements of the festival: Alexandria Choral Society, choral festival,
youth, $3,500, and so on. After list the key elements, I would find out the potential donors. 2.
Research: First, I would find our organization's previous data to find out who are interested in a
choral festival, like youth, and have the $3,500. Second, I would ask the Prospect Research workers
to help me collect more potential donors who may like coral and young people as well as the donors'
income. Finally, I find out Mrs. Winona Wealthy is one of our target donors because she had gave a
donation to Virginia Choral Festival in the past and she also is our current donor. 3. Plan: In this
step, I would email and call her phone and persuade ... Show more content on Helpwriting.net ...
Engage: When Mrs. Winona Wealthy come to our concert, I would say hello, welcome and enjoying
the concert. After the concert, I would say thank you to her for participating the concert and make
sure she likes our music. 5. Ask: Continually, I would introduce the Alexandria Choral Society will
have a choral festival next year and ask if she feel free to have a coffee meeting with me next week
to talk more about the choral festival and would she consider support us. 6. Close: Before our coffee
meeting, I would send her a Solicitation letter and remind that we will have coffee meeting. In
addition, I would prepare all detail information about the choral festival. During the coffee meeting,
I would say thank to her past support to us and try to persuade her how our choral festival is
interesting for her. Also, I would mention we need her $3,500 support; therefore, we will reach more
youth people who like to sing in a choral and make more benefits for the Alexandria, which is our
organization's mission. 7. Thank You: When she promises to give us the $3,500 support, I am
appreciated for her. I would write a thank you letter for her and ask my tax department co–worker to
connect to her in order to help her deduction the

Finanicial Exam Handout
1. A company received cash in exchange for issuing stock. This transaction: a. increased assets and
increased equity b. increased assets and increased liabilities c. increased assets and increased
revenues d. increased assets and increased expenses 2. A company purchased office supplies on
account. This transaction: a. increased assets and increased equity b. increased assets and increased
liabilities c. increased assets and increased revenues d. increased assets and increased expenses 3. A
company performed services for a customer on account. This transaction: a. increased assets and
decreased equity b. increased assets and increased liabilities ... Show more content on
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increase revenue and decrease stockholders' equity d. increase net income and stockholders' equity
18. Which of the following statements regarding accounts is false? a. An asset is increased by a debit
and decreased by a credit. b. Dividends are increased by credits and decreased by debits. c. A
liability is decreased by a debit and increased by a credit. d. Revenue is increased by a credit and an
expense is increased by a debit. 19. Which accounts are increased by debits? a. Assets and owners'
equity b. Expenses and owners' equity c. Assets and expenses d. Assets, expenses, and owners'
equity 20. The debit side of the account always indicates: a. amount of decrease in an account b.
amount of increase in an account c. amount received in the transaction d. amount given in the
transaction 21. A business purchases a truck by signing a note payable to the seller. Such a
transaction would include a: a. credit to Truck b. debit to Note Payable c. credit to Note Payable d.
debit to an expense account 22. The accounting transaction to record payment of an electric bill
would include a: a. debit to Cash b. credit to Accounts Payable c. debit to Utilities Expense d. debit
to Accounts Receivable 23. The entry to record $750 received from a customer for services
previously rendered to that customer

The Basic Principles of Accounting
The Basic Principles of Accounting
Cherry Marler
ACCT205–1203A–17, IP–1
Instructor Jeffery Bloom
June 06, 2012
Abstract
Accounting is used for several purposes. Investors, creditors, and individuals use accounting to see
whether a business is successful or not. Managers and employees use accounting to make decisions
on certain objectives. There are four main statements used in accounting: The balance sheet, income
statement, the statement of retained earnings, and the statement of cash flow. The equation for
accounting is assets equal equity plus liabilities. The equation must always balance out.
The Basic Principles of Accounting A business uses accounting to record all financial transactions a
business has made. The ... Show more content on Helpwriting.net ...
Debits and credits do not mean debits decrease an account or credits increase an account. Debit and
credit can increase or decrease an account. (Editorial Board, 2011).
Assets, liabilities, equity, revenue, and expenses has their own balance. A company will produce a
trial balance which will give the balance of all these in a certain amount of time such as monthly,
quarterly, or annually. The trial balance ensures that account balance is accurate. If the accounting
equation isn't balanced out then there is an error in the accounting records.
The final process of accounting is producing financial statements. The first statement is the income
statement. The income statement shows a company's profit or loss after revenue and expenses. The
equation for the income statement is revenue minus expenses equal net income. The next statement
produced is the statement of retained earnings. The statement of retained earnings starts out with the
net income retrieved from the income statement, which is added to the beginning retained earnings
from the previous month then subtracts the money paid out. The last document is the balance sheet.
A balance sheet contains a more detailed statement of each account balance. (Tracy, 2008).
A certain standard of moral and professional ethics should be kept in accounting. If professional
ethics are not met, some consequences may be faced. These

Advantages And Disadvantages Of Accounting Software
ACCOUNTING SOFTWARE'S Software's that records of accounting transaction in a convenient
manner. The first software designed for accounting purposes was for basic computations and
accumulation of numbers in early days, computing systems added and subtracted numbers to help
business organizations to keep their financial information. As advancement in capabilities, complex
systems were used to record financial transactions. Software's has made a huge difference in the
history of accounting. In the early days people used to record transactions by writing step by step. It
would be easy in the small business but it would be hectic for the larger organizations. The
development of software's has made all the business organizations to record transactions ... Show
It uses a double–entry book keeping system which was initially made for personal finances but now
it has been updated with features for small organizations. Though this software now has been
upgraded, still it has some downfall such as it doesn't include inventory management and does not
support sales system. It also allows importing QuickBooks data (types of software no.1).
ADVANTAGES OF ACCOUNTING SOFTWARES CONTROL – An accounting software can
provide management with internal controls to record financial transactions in a consistent manner. It
also ensures that someone authorized person is doing the task that helps to prevent from fraud and
abuse. COST REDUCTION & PROFIT MAXIMIZATION – Because of a good accounting system,
it provides accurate information from which business organization can identify and reduce cost and
maintain profit margins. EFFICIENCY – With the software's on each employee's computer, they can
easily access different data's spending less time rather than searching and running more time in the
business. SPEED– By the use of accounting software, the entire process for preparing accounts
becomes faster. Furthermore, statements can be generated easily within a short period of

Accounting System And The Roman Empire
Another Society with their own intricate accounting system was the Roman Empire. This comes as
no surprise because of the scope and size of the Roman Empire; accounting was once again a
necessity to a well–maintained society. There is evidence of comprehensive financial statements in
the rule of Emperor Augustus circa 63 BC–14 AD. These statements included information on
expenses on "statistics concerning the provinces and dependent kingdoms; direct and indirect
taxation; as well as recurrent expenditures and gifts", as well as, "the amounts of cash in the
Aerarium...and in the hands of the publicani" (Oldroyd, "The Role...", 1995). The Aerarium was the
treasury, and the publicani was the public. These are similar to what the Chinese had because they
were used by the government to go about completing the financing and running of the empire. These
figures could be used to make it easier to track all the expenses and revenues of the government. The
government was not the only ones to keep accounting records in the Roman Empire either. Account
books were kept by those look to maintain and achieve citizenship. It is believed that "men of
property at Rome often did write up their permanent account–books about every month." They were
required to do this to maintain their citizenship because citizenship was tied to the amount of
property owned and this meant a need to keep records of it. (Oldroyd, "The Role...", 1995). As well
as citizens, accounting was a necessity for the soldier of

Accounting
Abstract It is career day at school and I have been personally asked to make a presentation to high
school students in my hometown about my role as an accountant. Although many of the students
will not become accountants, the majority of them will all have to deal with money sometime in
their life and they will need to know how to keep track of their money one way or another. That is
where accounting will play a role in their lives. The students will know the primary objectives when
it comes to accounting. The students will also be explained about the basic terminology of the
accounting process. They will also be explained about how accounting has affected my personal life
and also the ethics of my personal life. Accounting is also a ... Show more content on
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The seventh step is to have the financial statements prepared. After an accountant has made the
corrections from the balances of the adjusted trial balance, they are then ready to prepare the
financial statement. The eighth step is to close accounts. Accounts will need to be closed and have a
zero balance from all of the expenses and revenue that has been recorded and reported by each
period. The final step of the accounting cycle is to have an after closing trial balance. The
accountant has to be sure that they have closed out all of the revenues, withdrawals and expenses
accounts. If anything has been found after the capital, the accountant will have to go back and make
sure that they have closed out those accounts. This step is just to be sure that all of the accounts have
been closed out. BASIC ACCOUNTING TERMS There are four basic terms when it comes to
account. Those times are: asset, liability, revenue, equity and expense. Assets add to the value of a
company or the individual. Liabilities decrease the value of a company or the individual. Revenues
track all of the income that has been generated. Expenses are individual accounts that record
financial transactions. Equity identifies donations and investments to companies or individuals.
ETHICS IN ACCOUNTING There are people who rely on me as their accountant. Many people put
a lot trust in me to be competent in the type of work that

Business: Balance Sheet and Cash
BACC 100 Assignment # 1 1. Jellybean Company reported equity of $32,000 on its December 31,
2014 balance sheet. The following information is available for the year ended December 31, 2015:
Revenues $73,000 Expenses 59,000 Liabilities 11,000 What are the total assets of Jellybean
Company at December 31, 2015? A) $14,000. B) $25,000. C) $35,000. D) $46,000. E) $57,000. 2.
At the end of its first year of operations, Matlocke Company has total assets of $2,000,000 and total
liabilities of $1,200,000. The owner originally invested $200,000 in the business, but has not made
any further investments or taken any withdrawals. What is the first year 's net income for Matlocke
Company? A) $ 600,000. B) $ ... Show more content on Helpwriting.net ...
(2) Received $1,500 cash from Barbara Hanson, the owner of the business. (3) Received $800 from
a customer in partial payment of his account receivable which arose as a result of sales during June.
(4) Rendered photography services to a customer on credit, $500. (5) Borrowed $2,500 from the
bank by signing a promissory note. (6) Received $1,000 from a customer in payment for services to
be rendered next year. How much revenue was earned in July? A) $1,200. B) $2,000. C) $3,000. D)
$5,500. E) $7,000. 13. Janfer Book Store purchased a new automobile that cost $10,000, made a
down payment of $3,000, and signed a note payable for the balance. The entry to record this
transaction is: A) Cash 3,000 Note Payable 7,000 Automobile 10,000 B) Cash 3,000 Automobile
3,000 C) Automobile 10,000 Cash 3,000 Janfer, Capital 7,000 D) Automobile 3,000 Cash 3,000 E)
Automobile 10,000 Notes Payable 7,000 Cash 3,000 14. Aimes opened a new business by investing
the following assets: cash, $4,000; land, $20,000; building, $80,000. Also, the business will assume
responsibility for a note payable of $32,000. Aimes signed the note as part of his payment for the
land and building. Which journal entry should be used on the books of the new business to record
the investment by Aimes? A) Assets 104,000 Aimes, Capital 104,000 B) Assets

Lucent Technologies-Revenue Recognition Case Essays
a) –Revenues are inflows of assets or settlements of liabilities or both. Revenues come from
activities of the entity's central operations. –Gains are increases in net assets and from peripheral or
incidental transactions of an entity. –The difference between gains and revenues depend to a great
extent on the typical activities of a company. For example, when McDonald's sells a hamburger, it
records the selling price as revenue. However, when Mc Donald's sells land, it records any excess of
the selling price over book value as a gain. b) –In cash basis accounting, revenues are simply
recognized when cashed is received no matter when and how the services were performed or goods
delivered. –In accrual basis accounting, revenues ... Show more content on Helpwriting.net ...
e) Debit Account Receivable $12,321,000,000 Credit Products Revenue $9,632,000,000 Credit
Services Revenue $2,689,000,000 f) i) Lucent would recognize $12,323,000,000
($12,321,000,000+$2,000,000) in total revenue in fiscal 2002. Record the receipt of the initial
payment Debit Cash $2,000,000 Credit Revenue $2,000,000 ii) The sale recognized on June 30,
2002 because the equipment has been installed, tested, and accepted by the customer. And the
collection is receivable. iii) Lucent could defer revenue and related costs when it was uncertain as to
whether it would be able to collect the receivable. If Lucent determined the collection of the
receivables was unlikely, it would defer revenue but recognize costs. iv) Because this is sales service
on long–term contract, Lucent would use the percentage of completion method of accounting, which
means Lucent would recognize the sales and service had been completed until 09/30/02 for fiscal
2002. Lucent has determined that most equipment is generally installed by Lucent within 90 days,
but can be installed by the customer or a third party, as a result, over the two following years,
revenue should be recognized when title passes to the customer, which on the delivery of the
equipment, provided if all other revenue recognition criteria are

Essay Darden Case Study
CASE STUDY #2 – DARDEN RESTAURANTS, INC. – TRANSACTIONS AND
ADJUSTMENTS
Concepts
a. To prepare accrual–based financial statements, a company must adjust its accounts. This is
accomplished with periodic adjustments (also known as adjusting journal entries or accounting
adjustments). For each account below, explain the types of transactions or events that necessitate
periodic adjustments to the account for the typical company.
i. "Inventories, net." – If a company purchases products to be resold, there is an adjustment on the
balance sheet to reflect this net inventory.
ii. "Receivables, net." – If a company sells a product on credit, they do not receive cash, and thus
although in increase in retained earnings occurs, and increase ... Show more content on
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b. In general, what other accounts typically require periodic adjustments? In general, the other
accounts that typically require periodic adjustments are prepaid expenses, accrued expenses, and
accrued revenues.
c. Why do companies close their books at the end of each accounting period? What types of
accounts are close in this process?
Companies close their books at the end of each accounting period in order to transfer the balance in
temporary accounts into retained earnings. The closing process brings the retained earnings account
up to date so that it accurately reflects the current period's income statement activity and dividends
so that the balance sheet can be prepared. The types of accounts that are closed in the process are all
the income statement accounts and any dividend account.
Process
d. For each item in quotations, provide the year–end total disclosed in Darden's 2007 income
statement. Write a journal entry to record the activity for the year. Assume that the company
recorded a single (summary) journal entry. i. "Sales." Assume that 5% of sales are on account, 3% of
sales represent gift card redemption, and the rest are cash sales.
AR 278.36
Cash 5,121.73
UR 167.01 Liabilities 167.01 Sales 5,567.10
ii. "Interest, net" expense. Assume that all these costs were paid in cash. Interest, net

Accounting
Landline Should Go For Net Revenue The accounting issue at hand in this case is revenue. Landline
is offering call routing services for PRU and the former entity has to make some receipts from the
services rendered. To put the issue at hand in context, revenue is generally the income received by
any company from selling goods or services. In abroad sense, revenue is the income received by any
commercial institution for the goods sold or services rendered. It is basically the incoming receipts
generated from the services offered or goods sold. It is the core parameter of consideration in the
event of evaluating the company's health. There are two classifications of revenue and the situation
in which Landline is requires serious ... Show more content on Helpwriting.net ...
Landline is essentially being outsourced by PRU for routing the calls of the latter yet PRU does not
mention it in its marketing campaigns or any other strategic communications of the business. This
leaves Landline as a fully–fledged contractor of the outsourced variety. From the relationship
between the two companies where Landline submits 80% of revenue to PRU, it is clear that landline
gives out commissions to PRU yet it does all the logistics of the daily running of the phone routing
service. This puts Landline in a critical situation where the taxman comes calling and the customers
who use primarily Landline's infrastructure are not even aware o0f the existence of such a company.
It would be wise for Landline to consider net revenues in the relationship it has with PRU. This way,
landline will be able to determine the feasibility of the engagement in terms of profitability and
viability much faster than if it went for gross revenue. Gross revenue would be false indictor of the
financial position of Landline because 80% of the gross revenue belongs to PRU yet Landline does
all the logistics of hiring and paying statutory bills. The journal entries that re important here are the
number of seconds per call, the applicable statuary tax per on each call, the hardware and software
resource requirements necessary to facilitate the call every second or minute, and the human
resource cost applicable to making

Financial Accounting
Financial Accounting Assignment 2
1 of 25
The credit term 2/10 n/30 means: that after 10 days 2% interest is charged. that there is a 10%
discount if payment is received within 30 days. that there is a 2% discount if payment is received
within 10 days. there is a 10% discount if paid immediately and 2% if paid within 30 days.
2 of 25
Family Food Stores purchased canned goods at an invoice price of $3,000 and terms of 2/10, n/30.
Half of the goods had been mislabeled and were returned immediately to the supplier. If Family
Food pays the remaining amount of the invoice within the discount period, the amount paid should
be:
$1,440.
$1,470.
$2,940.
$3,000.
3 of 25
The balance shown on a bank statement is always equal to the ... Show more content on
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What is the amount of uncollectible accounts expense recognized in VIP's income statement for
January?
$6,400
$8,000
$8,700
$7,200
13 of 25
The Cash account in the ledger of Triangle Floors shows a balance of $15,267 at September 30. The
bank statement, however, shows a balance of $19,700 at the same date. The only reconciling items
consist of a bank service charge of $7, a large number of outstanding checks totaling $8,170, and a
deposit in transit.
Refer to the above data. What is the amount of the deposit in transit?
$4,440

$7,104
$3,730
$4,333
14 of 25
Herbert Corp uses its periodic inventory system and the following information is available:
Sales...................................... | $31,000 | Inventory–Beginning................. | 8,000 | Inventory–
Ending..................... | 7,000 | Purchases................................ | 23,000 | | |
Calculate the cost of goods sold:
$7,000.
$24,000
$23,000.
$31,000
15 of 25
On November 1, 2005, Phillip Corporation sold land priced at $600,000 in exchange for a 7%, six–
month note receivable.
Refer to the above data. The journal entry made by Phillip to record this transaction on November 1,
2005, includes: a debit to Notes Receivable of $621,000. a debit to Interest Receivable of $21,000. a
credit to Interest Revenue of $21,000. a debit to Notes Receivable of $600,000.
16 of 25

Bookkeeping and Record Keeping Basics
Bookkeeping and Record Keeping Basics
Adapted from content excerpted from the American Express® OPEN Small Business Network
Proper bookkeeping is important to sustaining and expanding a business. Without it, you run the risk
of hitting cash flow crunches, wasting money, and missing out on opportunities to expand. When
you are devising or revising your bookkeeping routine, remember that the purpose of bookkeeping
is to help you manage your business and to enable tax agencies to evaluate your business activity. As
long as your bookkeeping achieves both of these objectives, it can – and should – be as simple as
possible.
The general guidelines here outline what you must take care of and provide ideas for how to keep
your books in an ... Show more content on Helpwriting.net ...
Keep a log of each category of expense, for tax purposes and write yourself a check for the total.
Write cash reimbursable in your check register to differentiate this from taxable income.
Alternatively, you can keep a petty cash record by writing a check to petty cash and keeping a log of
each expense paid out of petty cash.
Inventory Records
Keeping on top of your inventory records will enable you to prevent pilferage, keep inventory
holdings to a minimum, and track buying trends, among other things.
If you sell a large number of small–ticket items –– for example, as in a stationary store –– you might
want to use a computer system to track inventory or tie your computer system into your sales by
having a POS (point of sale) inventory system. If you sell larger ticket items you may be able to do
it yourself on paper.
The crucial inventory information you need to capture is: date purchased, stock number of item
purchased, purchase price, date sold, and sale price.
Accounts Receivable
If your products or services are paid for at time of delivery, you will not need an accounts receivable
tracking system. However, if you provide services or products for which people pay you at a later
date, your accounts receivable records keep track of what is owed to you. You can monitor accounts
receivable by holding on to a copy of all invoices sent out or by keeping an accounts receivable
record. Either way, the information you need to capture includes: invoice date,

Meaning And Definition Of Ledger By J. R. Batliboi
Meaning and Definition of Ledger
According to J.R. Batliboi , "The ledger is the chief of accounts and it is in this book that all the
business transactions would ultimately find their place under their accounts in a duly classified
form."
A Ledger should be kept in the form of bound register, or in the form of cards or in punched sheets
or it can be in the form of loose leaf binder. Every account in the ledger is opened preferably or it
can be in a separate page or card
These all business transactions are first recorded in Journal or Special Purpose Subsidiary Books.
The next step is to transfer the entries to the respective accounts in Ledger. In other words this
shows that all the entries are recorded in Journal or Special Purpose Subsidiary ... Show more
content on Helpwriting.net ...
All transactions relating to an account should be entered at one place. In others words, two separate
accounts should not be opened for posting transactions relating to the same account. If there are two
customers with similar names, say the Account of Anil (of Karol Bagh) and the Account of Anil (of
Chandni Chowk).
2. The word "To" is used before the accounts which appear on the debit side of an account.
Similarly, the word 'By' is used before the accounts which appear on the credit side of an account.
3. If an account has been debited in the journal entry, the posting in the Ledger should also be made
on the debit side of such account. In the particular column, the name of the other account which has
been credited in the Journal entry should be written for reference.
4. If an account has been credited in the Journal entry, the posting in the Ledger should also be made
on the credit side of such account. In the particular column, the name of the other account which has
been debited in the Journal entry should be written for reference.
5. Similar account which has been posted on the debit side of an account should also be posted on
the credit side of another

Career Fair
Career Fair
Mike Russell
AIU Online Abstract
Accurate accounting and the understanding can make or break your company or organization; not to
mention possible jail time in the worse cases. The first way of ensuring accurate accounting is
understanding the objectives. The second way is to understand the terminology of the accounting
process and in the financial reporting aspects. The third way is to understand the ethics behind the
accounting and reporting process. The forth way is to impement your role in the accounting process.
Career Fair The primary objectives of accounting, basic terminology in the accounting process, the
financial reporting, the ethics and the individual role each of us can play in the accounting process ...
Show more content on Helpwriting.net ...
These companies like Enron caused so many heartaches with the public that nothing will ever be
done to help those people that lost everything from these scandals. The Sarbanes Oxley Act of 2002
was the newest regulation guidelines from the government that requires financiers to receive
financial information pertaining to securities offered for public sale and it prevents deceit,
misrepresentation or any other fraud in securities; hence why it is sometimes called the "truth in
securities" law (The Laws That Govern the Securities Industry, 2013). I personally think this will
stop a lot of these scandals and will better help the people and corporations in doing the right thing.
This Act should better provide implantations of more guarded regulations for accountability of
companies. I also think this act will help ensue better ethics into companies, because with all of the
scandals being publicized it now becomes everyone's responsibilities in reporting correctly. I think
with people seeing these CEO's and executives going to jail; it will make other even not at that level
do the right thing or at least report it.
Role Technology Plays in Small Business Accounting
In today's time the accounting and book keeping ranges from the old way of paper and pen to
extremely large accounting data base systems for the major companies and organizations around the
world; although either system could be used but

Joan Holtz Case 5-3
ACCT101 project Case5–3 1. Electric utility bills Method 1: As everyone knows, the electricity
meters can be read every month. Therefore, in December the company will know the electricity
usage of the former 12 months including that of December last year. And the usage of electricity in
December this year can be included in the next year's revenue. Method 2: Strictly speaking, the
revenue recognized in method 1 is not earned in THIS YEAR. through the method of estimating the
electricity usage in December this year, added by the actual usage of former 11 months, we can get
record the revenue and then do some adjustment in the next year. 2. Retainer fee none of the
$10,000 should be counted as revenue in 2006. In accordance with ... Show more content on
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Account payable 500 Cash 500 American Express should record the journal entries: Cash 500
Account receivable 500 8. Product repurchase agreement Manufacturer A has no revenue in 2006,
for it promised to repurchase the merchandise from Wholesaler B at the moment A sold them in
December 2006, even though the repurchase happened in 2007. A also agreed to repurchase
merchandise with higher price later on. This is a financing activity but not the operating activity.
$100,000 of the payment should be considered as notes payable, and the agreed amount of
repurchase less $100,000 is interest payable at mature date. 9. Franchises The answer is no The
revenue should be recognized after the national company provide the relevant services and conduct
the obligations to the franchise, such as the right of using their well–known name, one–week initial
training course, national wide referral system and various marketing and management aids. If the
revenue is recognized in the year of signing agreement, after the market saturation, the national
company will not recognize any revenue from franchises, i.e. lose 25% of

Problem 2-1
1. Explain the events that probably gave rise to journal entries 1 through 8 of exhibit 1. a. Entry 1:
Miss barbarra Thompson opened the company investing USD 65,000.00 cash and USD 100,000.00
from Bank Borrowings. b. Entry 2: The company paid its Rent amounting to USD 1,485.00 c. The
company bought inventory items worth USD 137,500.00 on credit. d. The company bought
Furnitures and Fixtures (10 years useable life) for cash amounting to USD 15,500.00 e. The
company utilized USD 1,320.00 worth of advertising and paid it with cash. f. The company paid its
wages worth USD 935.00 g. The company bought USD 1,100.00 worth of office supplies. h. The
company paid its utilities worth USD ... Show more content on Helpwriting.net ...
Closing Balance for Cash Debit | Credit | 1 USD 165,000.00 | 2 USD 1,485.00 | (9) USD
38,000.00(11) USD 3,614.00 | (4) USD 15,500.00 | | (5) USD 1,320.00 | | (6) USD 935.00 | | (7)
USD 1,100.00 | –––––––––––––––––––––––––––––––––––––––––––––––––
USD 206,614.00Balance 84,661.00 | (8) USD 275.00(12) USD 96,195(15) 688.00(17) 1,485.00(18)
2,310.00–––––––––––––––––––––––––––––––––––––––––––––––––
(20) 660.00USD 121,953.00 |
Closing Balance For Merchandise Inventory Debit | Credit | (3) 137,500.00(13) 49,940.00 | (14)
38,140.00 | 187,440.00Balance 149,300.00 | 38,140.00 |
Closing Balance for Accounts Payable Debit | Credit | (12) 96,195.00 | (3) 137,500.00(13)
49,940.00(20) 1,100.00 | 96,195.00 | 188,540.00Balance 92,345 |
Closing Balance for Accounts Receivable Debit | Credit | (10) 14,850.00 | (11) 3,614.00 |
14,850.00Balance 11,236.00 | 3,614.00 |
Closing Balance for Sales Revenues Debit | Credit | | (9) 38,000.00(10) 14,850.00 | |
52,850.00Balance 52,850.00 |
Closing Balance for Wages Debit | Credit | (6) 935.00(15) 688.00(16) 440.00 | | 2,063.00Balance
2,063.00 | |
Closing Balance for Rent Expenses Debit | Credit | (2) 1,485.00(17) 1,485.00 | | 2,970.00Balance
2,970.00 | |
Closing Balance for Advertising Expenses Debit | Credit | (5) 1,320.00(20) 1,760.00 | |
3,080.00Balance 3,080.00 | |

Closing Balance for Utilities Expenses Debit |

Business Finance: Questions
FI504 exam 1. The ACE Company has five plants nationwide that cost $100 million. The current
market value of the plants is $500 million. The plants will be recorded and reported as assets at a.
$100 million. b. $600 million. c. $400 million. d. $500 million. _____ 2. A basic assumption of
accounting that requires activities of an entity be kept separate from the activities of its owner is
referred to as the a. stand alone concept. b. monetary unit assumption. c. corporate form of
ownership. d. economic entity assumption. _____ 3. A net loss will result during a time period when
a. liabilities exceed assets. b. dividends exceed revenues. c. expenses exceed revenues. d. revenues
exceed expenses. _____ 4. As of ... Show more content on Helpwriting.net ...
d. either in February or March depending on when the pay period ends. _____ 16. A small company
may be able to justify using a cash basis of accounting if they have a. sales under $1,000,000. b. no
accountants on staff. c. few receivables and payables. d. all sales and purchases on account. _____
17. Which one of the following is not a justification for adjusting entries? a. Adjusting entries are
necessary to ensure that revenue recognition principles are followed. b. Adjusting entries are
necessary to ensure that the matching principle is followed. c. Adjusting entries are necessary to
enable financial statements to be in conformity with GAAP. d. Adjusting entries are necessary to
bring the general ledger accounts in line with the budget. _____ 18. If a resource has been consumed
but a bill has not been received at the end of the accounting period, then a. an expense should be
recorded when the bill is received. b. an expense should be recorded when the cash is paid out. c. an
adjusting entry should be made recognizing the expense. d. it is optional whether to record the
expense before the bill is received. _____ 19. Quirk Company purchased office supplies costing
$6,000 and debited Office Supplies for the full amount. At the end of the accounting period, a
physical count of office supplies revealed $2,400 still on hand. The appropriate adjusting journal
entry to be made at the end of the period

Health Service Management 340 Final
1. Question : (TCO 4) Your hospital has just been told that all of your cardiovascular surgeons are
transferring their practice to a competitive hospital beginning next year. How would this affect a
forecast of volume?
Student Answer: First and foremost, if a hospital is suddenly lost all of its cardiovascular
surgeons...heads will roll. However, if there are a major lost of service such as the cardiovascular
surgeon...there will be a decrease in the volume due to the lost of services. Thus when the hospital
have a reduce in the total volume it will also have a reduce in total cost. If the hospital is operating
under statistics budget...in the long run, through the development or discontinuation of certain
programs volume may be ... Show more content on Helpwriting.net ...
OCE designed to processes claims for all outpatient institutional providers including hospitals that
are subject to the Outpatient Prospective Payment System (OPPS) as well as hospitals that are NOT
(Non–OPPS). Each OCE results in one of six different dispositions. The dispositions help to ensure
that all fiscal intermediaries are following similar procedures. There are four claim–level
dispositions: Rejection, Claim must be corrected and resubmitted; denial, claim cannot be
resubmitted but can be appealed; return to provider, problems must be corrected and claim
resubmitted; and suspension, claim requires further information before it can be processed. There
are two line item–level dispositions: rejection, claim is processed but line item is rejected and can be
resubmitted later; and denial, claim is processed but line item is rejected and cannot be resubmitted.
(Essentials of Health Care Finance, 7th Edition. Jones & Bartlett Publishers p. 26).
4. Question : (TCO 1) How could a hospital legally avoid being covered by the Emergency Medical
Treatment and Labor Act (EMTALA)?
Student Answer: The Emergency Medical Treatment and Active Labor Act (EMTALA) passed in
1986 and it requires hospitals to provide care to anyone needing emergency healthcare treatment
regardless of citizenship, legal status or ability to pay. It further stated Participating

History and Development of Accounting
Accounting is defined by the American Institute of Certified Public Accountants (AICPA) as "the art
of recording, classifying, and summarizing in a significant manner and in terms of money,
transactions and events which are, in part at least, of financial character, and interpreting the results
thereof."
Accounting is thousands of years old; the earliest accounting records, which date back more than
7,000 years, were found in Mesopotamia (Assyrians). The people of that time relied on primitive
accounting methods to record the growth of crops and herds. Accounting evolved, improving over
the years and advancing as business advanced.
Early accounting records in different parts of the world
Token accounting in ancient Mesopotamia
The ... Show more content on Helpwriting.net ...
The bulk of the documents relate to the running of a large, private estate is named after Heroninos
because he was phrontistes (Koine Greek: manager) of the estate which had a complex and
standarised system of accounting which was followed by all its local farm managers Each
administrator on each sub–division of the estate drew up his own little accounts, for the day–to–day
running of the estate, payment of the workforce, production of crops, the sale of produce, the use of
animals, and general expenditure on the staff. This information was then summarized as pieces of
papyrus scroll into one big yearly account for each particular sub–division of the estate. Entries were
arranged by sector, with cash expenses and gains extrapolated from all the different sectors.
Accounts of this kind gave the owner the opportunity to take better economic decisions because the
information was purposefully selected and arranged.
Simple accounting is mentioned in the Christian Bible (New Testament) in the Book of Matthew, in
the Parable of the Talents.
Luca Pacioli and double–entry bookkeeping
Bartering was the dominant practice for traveling merchants during the Middle Ages. When
medieval Europe moved to a monetary economy in the 13th century, sedentary merchants depended
on bookkeeping to oversee multiple

Modern Accounting Systems in Modern Organizations
Modern accounting systems have become the foundation from which the modern organization can
rely and depend upon to maintain a strong efficient strategy that will help the organization grow.
The modern accounting systems embraces the old accounting practices that have been used for
hundreds of years and builds upon that platform to give modern organizations control over the
finances. There must be set in place internal controls to keep the company assets from being stolen
and that is why modern accounting systems utilizes many internal controls with the organization.
The modern accounting system is one of the most valuable assets that a modern organization has in
its possession because modern accounting systems make better use of the ... Show more content on
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Knowing exactly which accounts are being debited and which accounts are being credited is
essential to maintaining financial records and keeping the organization on the right track for success.
Modern accounting uses debits and credits through the accounting equation which is used to
determine what accounts are debited and what accounts are credited to keep a harmonious balance
between the debits and credits. The accounting equation is like the groundwork for the debits and
credits and that is why modern accounting systems utilizes the accounting equation no matter what
the account may be because the assets must always equal the liabilities, owners equity. In the
modern accounting systems each debit must have a credit to keep the balance in the accounting
equation.
[At] the heart of modern financial accounting is the double–entry book–keeping system. This system
involves making at least two entries for every transaction: a debit in one account, and a
corresponding credit in another account. The sum of all debits should always equal the sum of all
credits, providing a simple way to check for [errors] (Sharda Gangwar, 2009).
The third way in which modern accounting systems have made a difference in modern organizations
would be with the adjusting process of accounting to maintain records that are up to date and
includes all transactions. If every transaction is completely accounted for in the financial records
then the company will not be in violation of

Origin of Accounting
Accounting historians have attempted to relate their knowledge of the variety of accounting
practices at various points of time, and in various places. It is to wider questions of the role of
accounting in reflecting and shaping not only business and management practice, but also economic
and social organization more generally. Finley's classic ¡§The Ancient Economy¡¨ , which analyzed
the embedded–ness of ancient economic activity in the social structure, and in the status concerns of
the free citizens, as constituting a brake on the development of profit–focused markets and
correspondingly on technology and trade. It saw the state of ancient accounting as itself making
impossible sophisticated profit–oriented calculation and rational ... Show more content on
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Writing, for example, is as old as civilization itself, but arithmetic ¡V the systematic manipulation of
number symbols ¡V was really not a tool possessed by the ancients. Rather, the persistent use of
Roman numerals for financial transactions long after the introduction of Arabic numeration appears
to have hindered the earlier creation of double–entry systems. Nevertheless, the problems
encountered by the ancients with record keeping, control and verification of financial transactions
were not entirely different from our current ones. Governments, in particular, had strong incentives
to keep careful records of receipts and disbursements ¡V particularly concerning taxes. And in any
society where individuals accumulated wealth, there was a desire by the rich to perform audits on
the honesty and skill of slaves and employees entrusted with asset management. But the lack of the
above–listed antecedents to double entry bookkeeping made the job of an ancient accountant
extraordinarily difficult. In societies where nearly all were illiterate, writing materials costly,
numeration difficult and money systems inconsistent, a transaction had to be extremely important to
justify keeping an accounting record. Five thousand years before the appearance of double entry, the
Assyrian, Chaldaean–Babylonian and Sumerian civilizations were flourishing in the Mesopotamian
Valley, producing some of the oldest known records of commerce. In this area

Cooperative Advertising Reserve : A Cooperative...
An excessive figure called the cooperative advertising reserve was literally recognized by Sunbeam
in the year 1996. It was mainly established to fund a part or portion of its personal retailers' costs by
running the local promotions.Anderson was supposed to have identified the increase of the amount
recorded known to 25% more than prior's year accrual amount which turns out to be an amount of
$21,800,000 dollars at least identified during the horizontal analysis of the financial statement
especially during the analytical procedures.
Looking back at GAAP, we realize they've mentioned that matching principles are not required at all
to make an estimate to all expenses incurred that are simply related to the revenues of that same
period.So, in that case we need to know that the recording of the estimation of the cooperative
advertising reserve would have been expected by the auditor ,but needs keep in mind that they need
be capable of determining the recorded estimate of the accruals or related expenses to be a
approximately close to the actual costs itself. By having the auditor fully understand the causal
factors associated with that that expense, we can test the estimate recorded by Sunbeam. Also, by
having the auditors understand the causal factor,they can be capable of determining whether those
the estimates made were appropriate under GAAP or not.
According to the excessive litigation reserve, it is more than likely that the amount of reserve and
the related expense

Effectiveness of Double Entry Accounting System
Giving examples, evaluate the effectiveness of the controls in the double entry system of accounting
in ensuring the accuracy of the accounts. As well as examining the controls, your evaluation should
consider errors that do not affect the balancing of the trial balance. Double entry accounting system
was invented in 15th century and still being in use until today, this is quite an interesting fact;
however it indicates that there is something about the system, thus making it so effective and
irreplaceable. To evaluate the effectiveness of the controls in the double entry system, we should
first question ourselves why is double entry book keeping system is still being used until today.
Double entry book keeping is very useful because ... Show more content on Helpwriting.net ...
Accounting is making it easier to then demonstrate the outcomes and results of the business. With
that being said, it is very clear that it is crucial for the accounts to be accurate. For the business it is
important for the various reasons. First of all the business wants to see how well it is doing every
year, that includes it's gross and net profit, the worth of its assets and liabilities, etc. The accuracy of
this information is vital, as the organisation's leadership can then analyse this information and make
decisions according to the outcomes. Second of all if the accounts are being produced inaccurate or
incorrect, the organisation will most likely make wrong decisions, which may lead it to the loss of
money or even bankruptcy. Secondly accurate accounts will help the day–to–day operations of the
business. However stakeholders are also interested in the accuracy of the accounts for the various
reasons presented below: Employees Employees of the business rely on accounts to receive the
wages and salaries they have earned, this means that if accounts of the organisation are made
inaccurately it may lead to employees receiving wrong amount of money, which is dreadful for
various reasons. If the wages are overpaid, it means that the organisation has lost funds it shouldn't
have, whereas

High School Finance Teacher
Accrual vs. Cash Basis Accounting
Alicia Wiley
Grantham University
Abstract
In this paper I have defined accrual and cash basis accounting. Also, I have answered the following
questions: Explain the difference between the accrual basis of accounting and the cash basis of
accounting. What are the major reasons for using accrual accounting? What are the purpose of a
journal and a ledger? Give an example of a contra–asset, and explain how it is recorded on the
ledger as a transaction. Explain what a "prepaid expense" is and how it is recorded on the ledger as a
transaction. What are the major differences in recording transactions for a for–profit organization
versus a not–for–profit, or are there any? List and record each transaction ... Show more content on
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A prepaid expense, such as rent or insurance, is a type of current asset. It is recorded by decreasing
Cash and increasing the prepaid amount by the same amount. Thus, the transaction only occurs in
the Asset section of the Balance Sheet, and it is a zero–sum transaction.
What are the major differences in recording transactions for a for–profit organization versus a not–
for–profit, or are there any? For–profit organization would record certain transactions under Owner's
Equity, whereas the Not–for–Profit would use Net Assets. Also, a for–profit would not show
restrictions on Owners' Equity.
List and record each transaction for S. Zee Outpatient Clinic under the accrual basis of accounting at
December 31, 20X1, then develop a balance sheet as of December 31, 20X1, and a statement of
operations for the year ended December 31, 20X1. Journal Entries | | | | | | a | Cash | | 3,000,000.00 | |
| Unrestricted Contribution | | | 3,000,000.00 | | | | | | b | Equipment | | 2,000,000.00 | | | Cash | | |
2,000,000.00 | | | | | | c | Cash | | 1,000,000.00 | | | Bank Loan | | | 1,000,000.00 | | | | | | d | Supplies | |
1,500,000.00 | | | Cash | | | 1,500,000.00 | | | | | | e | Accounts Receivable | | 5,500,000.00 | | | Service
Revenue | | | 5,500,000.00 | | | | | | f | Supplies Expense | | 1,000,000.00 | |

Exam 2 Essay
Acct 328 ® Exam 2
Part 1 – 60%
Name of Company – Each student can make up a company name
Type of business – service company sole proprietorship
Chart of Accounts – see below.
The numbers correspond to dates in the month of February (Use journal entries only) 1. Initial
capital of $100,000 2. Prepaid rent – $19,200 for 2 years 3. Prepaid insurance – $24,000 for 2 years
4. Purchased a desk on account for $500 5. Purchased office supplies for $950 6. Sold 20 bicycles @
$350 each 7. Sold 3 bicycle parts for a total of $450 on account 8. Used $250 worth of office
supplies 9. Purchased repair supplies for $600 on account 10. Received $250 in cash from
transaction on 2/7/2011 11. Paid cash ... Show more content on Helpwriting.net ...
1. A post–closing trial balance will show
a. zero balances for all accounts.
b. zero balances for balance sheet accounts.
c. only balance sheet accounts.
d. only income statement accounts
2. The income statement for the year 2010 of Poole Co. contains the following information:
Revenues $70,000 Expenses: Wages Expense $45,000 Rent Expense 12,000 Advertising Expense
6,000 Supplies Expense 6,000 Utilities Expense 2,500 Insurance Expense 2,000 Total expenses
73,500 Net income (loss) $(3,500) After all closing entries have been posted, the revenue account
will have a balance of
a. $0.
b. $70,000 credit.
c. $70,000 debit.
d. $3,500 credit.
3. Which of the following would not result in unearned revenue?
a. Rent collected in advance from tenants
b. Services performed on account
c. Sale of season tickets to football games
d. Sale of two–year magazine subscriptions 4. The following is selected information from Alpha–
Beta–Gamma Corporation for the fiscal year ending October 31, 2010. Cash received from
customers $300,000 Revenue earned 350,000 Cash paid for expenses 170,000 Cash paid for

computers on November 1, 2009 that will be used for 3 years (annual depreciation is $16,000)
48,000 Expenses incurred, not including any depreciation 200,000 Proceeds from a bank loan, part

Ethical Decisions In The Workplace
We, as individuals, face ethical decisions everyday whether it be for our job or within ourselves. I
currently am facing an ethical dilemma myself. My boss has asked me to balance the books for the
company by tomorrow morning. He has a meeting in the afternoon with the board to discuss the
numbers, so I know I can not be late, however, there is a complication with my calculations. I can
not get the book to balance out. I am scared that my boss will get fired if he does not have the
numbers on time. Consequently, I must make a decision on how I am going to get correct numbers
to my boss by tomorrow morning.
There are so many options and directions I could go to solve this problem. I have chosen to solve
my issue by going back through each month to ensure that all the amounts balance out. I understand
this will take a great deal of time, but it is crucial to find where I made a mistake. First, I will make
sure that all of the amounts are placed in the correct category. For example, I want to ensure that
money used for rent is credited from cash in bank and debited in rent expense. After I do that, I
should be able to check if the debits and credits equal each other. One major element to accounting
that I have learned is that your credits and debits should always equal each other and if they do not,
then you have made a mistake ... Show more content on Helpwriting.net ...
Doing the right thing may not always be the easiest, but that should not change anything. I am not
100 percent certain if I will get the book to balance out by tomorrow morning, but I do know that no
matter what I will take responsibility for my work whether it be bad or good. If I do the right thing,
then I can at least walk away knowing that I did not cheat to win, instead I failed, yet I can use this
failure as a learning experience. Overall, taking responsibility, in my opinion, is the most ethical
decision I can make, therefore, that is what I will

It has been said that pre-numerical counting systems...
It has been said that pre–numerical counting systems pre–dated the written language. Business
accounting is rooted in the organization of monetary claims throughout the history of the Western
civilization, developing even before the ancient accountants could note the mathematical entries.
Beginning in Mesopotamia around 3500 B.C, and developing throughout the 14th century in
Europe, accounting has become one of the largest advancements in the Western world. This long
standing form of collaborating financial data has evolutionalized the way we approach business in
the 21st century. While today's accountants are involved in the analysis of financial data and the
auditing of cash flow through a corporation, this hasn't always held true. The ... Show more content
on Helpwriting.net ...
Often, for precaution, the trade was again written in the outercrust of the tablet so that no other
alterations could be made. Ancient Europe held an accounting system similar to that of the
Mesopotamian community. Here they used a form of papyrus, a paper material made from the stem
of a water plant, instead of the clay tablets that were much less plentiful in this area. "Accountants"
in this part of the western world were typically associated with a specific store or trade business, and
were evaluated extensively by an internal verification system within the corporation for which they
were accredited in order to implement a more detailed accounting transaction built upon honesty and
credibility of those calculating. While Egyptians made thousands of trades regarding gold and silver,
they referred to each as an exchange of goods rather than ascribing value to the item. This made the
calculating and recording different commodities in different credit terms very difficult. According to
public records, ancient Greece used accountants for personal monetary organization and to maintain
authority of governmental finances. It's systematic process equipped with leaders was evident in the
Athens Popular Assembly, who ratified all decrees regarding financial matters in the state. This
assembly met every ten days to discuss events regarding Athenian code and allowed citizens to
attend and vote on commissioned decisions made in government. Perhaps Greece's most

Critical Evaluation of Accounting Cycle
INTRODUCTION:
An Organization often needs a way to keep score when conducting business operations. Accounting
usually fits this need because it allows create to companies financial reports that can be compared
with other companies or an industry standard. Business owners and managers also use accounting to
review the efficiency of operations. This information may help owners and managers make business
decisions and improve the company's profitability.
Accounting is basically defined as the process of identifying, measuring and communicating
economic information to help its users make informed judgment and decisions. It also involves
recording, classifying, summarizing and interpreting financial transactions and events about
economic ... Show more content on Helpwriting.net ...
Financial statements are the most important reports of a business. These statements are prepared
from the information in the trial balance. The purpose of these statements is to show the reader the
financial position, financial performance and cash flows of a business, as well as other useful
information concerning the business. Financial statements are usually prepared once a year.
Financial statements consist of (amongst other things) an income statement, statement of changes in
the owner's equity, balance sheet, cash flow statement and (where needed) an auditor's report.
Thus we can say ACCOUNTING CYCLE indicates the technique of preparing financial statement
for the consumption of different stockholders within a given guideline. Accounting Cycle is a
Technique: The accounting cycle begins when business transactions are entered into the journal.
Transactions include all events that impact any of the company 's accounts, such as "cash on hand,"
or "accounts receivable," or "bank loans payable." Journal entries accumulate in chronological order
–the order in which they occur. The second step in the accounting cycle is transferring (posting)
journal entries into a ledger or ledgers, where they are organized first by account, and then
chronologically within accounts. Journal:
On 1 September, two customers place product orders, on credit. Customer 1 orders $4,200 in
products, Customer 2 orders $5,800 in products. Later the same day, the company

Accounting Analysis On Financial Accounting
Accounting has many branches that it can be divided into. It can be divided into several areas of
activities. Accountings main branches are financial accounting, Management accounting, Cost
accounting, Auditing, Tax accounting, Accounting systems, Fiduciary accounting and Forensic
accounting.
Financial accounting: This branch of accounting measure's and records the transactions of a
business. Financial accounting focuses on the preparation of the five basic financial statements
namely statements of financial position, statements of comprehensive income, statements of cash
flows, statement of changes in equity and notes to financial statements. At the end of a period
usually a year a profit and loss account and a balance sheet is prepared ... Show more content on
Helpwriting.net ...
It is governed by the internal revenue code and has specific instructions that should be followed by
individuals and companies when preparing tax returns. Accounting Systems: Accounting systems
involves the implementation, installation, development and monitoring of accounting procedures
and the systems used in the accounting process. This includes the gathering of accountable financial
data, software management, accounting personnel directing and the designing of business forms to
be used in the data– gathering process. This branch is linked to management advisory services. To
be successful in this field technical knowledge and skills in information technology is needed.
Fiduciary Accounting: Fiduciary accounting is the accounting and evaluation of a third party's
business, property and possessions maintained under the guardianship by an entrusted individual. A
few examples of fiduciary accounting include receivership, trust accounting and estate accounting.
Forensic Accounting: This branch involves the investigation of embezzlement or fraud using
accounting skills and analysing financial information to be used in legal proceedings. Forensic
accounting deals with court and litigation cases, fraud investigation, claims and dispute resolution
and other areas that involve legal matters. This area is a popular trend in

The Accounting Cycle
The Accounting Cycle
Presented to
Ms. Aisha Meeks
Department of Business Management
College of Business Administration
Alabama State University
In Partial Fulfillment of the Requirements for the Course
ACT.214.04
By
Krystal Hall
January 26, 2013
Memo:
To: Ms. Aisha Meeks
From: Krystal Hall
Date: 2/26/2013
Re: The Accounting Cycle
Every company has an accounting cycle. An Accounting cycle is the process that begins with
analyzing and journalizing transactions and it ends with the post–closing trial balance. When
preparing the accounting cycles there are ten steps that are included. They are as follow; transactions
are analyzed and recorded in the journal, posted to the ledger, an unadjusted trial balance is ... Show
Journalized and Posting Adjusting Entries Then, adjusting entries are journalized and posted to the
ledger. At the end of the accounting period the adjusting entries appearing in the work sheet are
recorded in the journal and posted to the ledger; bringing the ledger into agreement with the data
reported on the profit and loss account and balance sheet. The adjusting entries are dated as on the
last day of the accounting period, even though they are usually recorded some time later Preparing
an Adjusting Trial Balance The next step involves an adjusting trial balance being prepared. The
adjusted trial balance is prepared to verify the equality of the total of the debit and credit balances.
This is the last step before preparing the financial statements. If the adjusted trial balance does not
balance, an error had occurred and must be found and corrected. Preparing the Financial Statements
The financial statements are then prepared. The financial statement is the most important outcome of

the account cycle. In this process the income statement is prepared first, followed by the statement
of owner's equity, and then the balance sheet. The statement can be prepared directly from the
adjusted trial balance, the end–of–period spreadsheet, or the ledger. The net income or net loss
shown on the income statement is reported on the statement of

Accounting 504
Discussion Questions Week 2 1.) What is meant by the term double–entry accounting? Examples are
great and try to build on what each other has said.
Double entry accounting is based on the fact that every financial transaction has equal and opposite
effects in at least two different accounts. In the double entry system, transactions are recorded in
terms of debits and credits. Since a debit in one account will be offset by a credit in another account,
the sum of all debits must therefore be exactly equal to the sum of all credits. The double–entry
system of bookkeeping or accounting makes it easier to accurately prepare financial statements
directly from the books of account and detect errors.
For example: A company borrows a loan ... Show more content on Helpwriting.net ...
| 5000 | | Supplies | 1200 | | Account Payable | | 1200 | Rent Expense | 8000 | | | | | Total | $14200 | $
14200 | 4.) What are adjusting entries and why are they important? | | | | | |
Adjusting entries are usually made on the last day of an accounting period so that the financial
statements reflect the revenues that have been earned and the expenses that were incurred during the
accounting period. The purpose of each adjusting entry is to get both the income statement and the
balance sheet to be correct. An example of adjusting entry: a customer paid a company in advance of
receiving goods or service, the amount is reported as a liability. After the goods or services are
delivered, an adjusting entry is needed to reduce the liability and to report the revenues. 5.) Cash
basis vs Accrual basis
The difference between accrual and cash basis accounting is the timing of when revenue and
expenses are recognized. The cash method is most used by small businesses and for personal
finances. The cash method for revenue is only used when the money is received and expenses are
only used when the money is paid out. The accrual method is used for revenue when it is earned and

Working With Financial Statements : Accounting Principles
Working with Financial Statements Accounting principles are like the Ten Commandments to a
CPA. The principles are recommendation or instructions on what an account should follow when
logging and informing on all accounting transactions. Businesses rely on their account every month
to maintain the financials records of the company. At the end of each month, it is important for every
transaction to be documented and posted as a financial entry in the monthly trail balance. An
account needs to ensure all journaling is correct; an account must know the importance of how to
record prepaid expenses, unearned revenues, accrued expenses, and accrued revenues. Revenue
Recognition Principle The Revenue Recognition Principle relates to the ... Show more content on
Helpwriting.net ...
R& D is necessary to detail the scope of the project, electricity is an expected expense during the
time of the project and then you have the salaries of the staff that will be paid. Expense Revenue
relates to the accrual basis of accounting which means that revenues are recognized when earned
and expenses when consumed. Prepaid expenses A prepaid expense, also known as a prepayment, is
and expense that is paid in cash before services are performed or merchandise is received. The
company with the prepaid expense will pay for a service, and it will be recorded as a debit to
prepaid expenses (such as insurance, supplies, etc.) and a credit to cash. The following is an
example of a prepaid expense and how to record it: Sanders Auto has an insurance policy with
Love's Insurance Company. To make the bookkeeping easier, Sanders Auto pays their insurance six
months at a time at $250 a month. Sander Auto has written a check to Love's Insurance Company
for $1500. Sanders Auto will record the transaction in the following way: Account Title Debit Credit
Prepaid Insurance $1500 Cash $1500 Each month, Sanders will use a portion of this prepaid
expense. This use will have to be recorded, and will be done as follows: Account Title Debit Credit
Insurance Expense $250 Prepaid Insurance $250 Unearned revenues Unearned (or deferred)
revenues are an important part of accounting and are

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