The document provides an overview of transaction processing and systems documentation techniques. It discusses the four parts of the data processing cycle and types of information systems can provide. It also describes how information is stored in computer systems and documents used to collect transaction data. The document outlines how to prepare data flow diagrams, flowcharts, and business process diagrams to document information systems. It includes examples of journals, double entry accounting, and correcting accounting entries.
The document provides information about completing the accounting cycle for a service business, including preparing various financial statements. It discusses the statement of comprehensive income/financial performance and the key elements included such as revenue, expenses, gains/losses, taxes. Sample statements are presented for Mimito Dental Clinic and Mariell's Beauty Salon. The statement of changes in equity and how it differs for sole proprietorships, partnerships, and corporations is explained. Finally, it covers the statement of financial position format and accounts, as well as an overview of the statement of cash flows including the three main activities of operating, investing, and financing.
Assignment Front Sheet Qualification Unit Number And TitleAaron Anyaakuu
The document provides instructions for an assignment assessing a student's understanding of financial accounting and reporting. It includes 5 tasks assessing the student's ability to: 1) understand regulatory frameworks and present on users' needs; 2) prepare financial statements from incomplete records; 3) prepare consolidated financial statements; 4) explain information needs, and prepare financial statements; and 5) interpret financial statements using ratios. The student must submit a single document of 4000-5000 words completing all tasks, citing sources, and declaring their work as authentic. Late submissions will be considered with valid reasons.
This document discusses budgets and variance analysis for managing a business. It defines a budget as a financial plan covering income and expenses. Variance analysis is the process of comparing actual budget outcomes to planned figures to identify favorable and unfavorable variances. The document provides examples of calculating variances for income, expenses, and profit budgets and interpreting the variances to understand factors that led to differences from the planned budget.
Quick Learn: concepts accrual accounting and cash flowEddie Zhong
The document provides an overview of accrual accounting concepts and cash flow statements. It includes examples of accrued income and expenses. It also works through the preparation of an income statement and statement of financial position based on provided transaction information. Key points covered include:
1) Accrual accounting recognizes transactions when they occur rather than when cash is received or paid.
2) Accrued income and expenses are amounts earned or incurred in one period but recorded in another.
3) A cash flow statement records cash inflows and outflows and is separated into operating, investing, and financing activities.
4) Reconciling net income to cash flow from operating activities accounts for non-cash items and changes
The accounting cycle has 8 major steps: 1) recording transactions, 2) posting to ledger accounts, 3) preparing an unadjusted trial balance, 4) making adjusting entries, 5) preparing an adjusted trial balance, 6) closing temporary accounts, 7) preparing post-closing financial statements, and 8) preparing a post-closing trial balance. The example shows the journal entries, ledger accounts, unadjusted trial balance, adjusting entries for depreciation, interest, and unearned revenue, and the closing entries to transfer temporary account balances to retained earnings for Company A.
This chapter discusses calculating profit and loss, and the double entry system for recording expenses and revenues. It explains that profit is calculated as revenue minus expenses, and how profit or loss affects the accounting equation and capital. Separate accounts are used for each type of expense and revenue, with expenses recorded as debits and revenues as credits. The chapter also covers how drawings by the business owner are recorded, decreasing capital rather than being an expense.
ACCOUNTING FOR BUSINESS – ASSIGNMENT SP1 2015PAGE ACCOUNTIN.docxannetnash8266
ACCOUNTING FOR BUSINESS – ASSIGNMENT SP1 2015
PAGE
ACCOUNTING FOR BUSINESS – ASSIGNMENT SP1 2015
ACCT 1008 Accounting for Business
Assignment – Trimester 1, 2015
DUE DATE: 14TH May (Class 1) 15th May (Class 2 and 3)
Student Name:
Student ID
Class Number
1._______________________________________________
________________ ________
2._______________________________________________
________________ ________
All questions are to be completed in this template.
QUES 1
QUES 2
QUES 3
TOTAL
PLEASE DO NOT WRITE IN THESE BOXES – THESE ARE USED TO RECORD YOUR MARKS FOR EACH QUESTION
Question 1 a.
HARRY’S HARDWARE, END OF PERIOD WORKSHEET - YEAR ENDED 30 JUNE 2015
Unadjusted Trial Balance
Adjustments
Adjusted Trial Balance
Income Statement
Balance Sheet
Account Name
Dr
Cr
Dr
Cr
Dr
Cr
Dr
Cr
Dr
Cr
Cash
6 000
Accounts Receivable
36 000
Inventory (1 July 2014)
43 000
Prepaid Rent
1 800
Warehouse Shelving
16 000
Acc’d Depreciation – Warehouse.
3 200
Point of Sale Equipment
4 000
Acc’d Depreciation – Equipment
2 000
Accounts Payable
32 250
H. Smith, Capital (1 July 2014)
58 000
H. Smith, Drawings
12 500
Sales
207 800
Sales Returns & Allowances
2 250
Discount Allowed
400
Purchases
140 200
Discount Received
900
Freight Inwards
2 150
Freight Outwards
1 200
Sales Staff Wages Expense
24 000
Local Government Rates Expense
800
Insurance Expense
3 500
Advertising Expense
3 750
Rent Expense
6 600
304 150
304 150
Profit/Loss
Question 1 Part (b)
Prepare a fully classified Income Statement for the period.
Question 1 Part (c)
Prepare a Statement of Changes in Equity for the period and a fully classified Balance Sheet as at the end of the period.
Question 2:
(Please type your answer to question 2 here)
Question 3:
YORK LTD
Cash Flow Statement
for the year ended 31 December 2015
Cash Flows from Operating Activities
$
$
Receipts from customers
Payments to suppliers & employees
______
Cash generated by operations
Interest paid
Income tax paid
______
_______
Cash Flows from Investing Activities
Interest received
Payment for Equipment
______
_______
Cash Flows from Financing Activities
Proceeds from Share Issue
Dividends paid
______
_______
Net increase / decrease in cash held
Cash at the beginning of the year
_______
Cash at the end of the year
___ ___
Question 3: (Students must show ALL calculations for question 3 or no marks will be awarded for this question)
Calculations
Question 3:
Calculations
.
Due Tues., May 2- 7 questions Big Time Picture Frames h.docxsagarlesley
Due Tues., May 2- 7 questions
Big Time Picture Frames has asked you to determine whether the company's ability to pay current
liabilities and total liabilities improved or deteriorated during 2009. To answer this question, you gather the
following data:
______________________________________________2009__________2008
Cash $52, 000 51, 000
Short-term investments 30,000 --
Net receivables 110,000 120, 000
Inventory 217,000 262,000
Total assets 540,000 490,000
Total current liabilities 265,000 202,000
Long-term note payable 44,000 54,000
Income from operations 165,000 153,000
Interest expense 44,000 37,000
Requirement
1. Compute the following ratios for 2009 and 2008:
a. Current ratio
b. Acid-test ratio
c. Debt ratio
d. Times-interest-earned ratio
a. Calculate the current ratio for both years. (Round your answers to two decimal places.)
2009: nothing
2008: nothing
The Variline Inc., comparative income statement follows. 2010 data are given as needed.
Variline, Inc.
Comparative Income Statement
Years Ended December 31, 2012 and 2011
(Dollars in thousands) 2012 2011 2010
Net sales $176,000 $160,000
Cost of goods sold 93,600 86,000
Selling and general expenses 46,800 41,400
Interest expense 9,600 10,900
Income tax expense 10,200 9,200
Net income $15,800 $12,500
Additional data:
Total assets $201,000 $192,000 $174,000
Common stockholders' equity $96,900 $89,800 $79,500
Preferred dividends $3,400 $3,400 $0
Common shares outstanding during the
year 20,000 20,000 18,000
Requirements
1. Calculate the rate of return on net sales.
2. Calculate the rate of return on total assets.
3. Calculate the rate of return on common stockholders' equity.
4. Calculate the EPS.
5. Did the company's operating performance improve or deteriorate during 2012?
Requirement 1. Calculate the rates of return on net sales for 2012 and 2011. (Round your answers to
three decimal places.)
2012:
nothing
2011: nothing
The Specialty Department Stores, Inc., chief executive officer (CEO) has asked you to compare the
company's profit performance and financial position with the average for the industry. The CEO has
given you the company's income statement and balance sheet, as well as the industry average data for
retailers.
Specialty Department Stores, Inc.
Income Statement Compared with Industry Average
Year Ended December 31, 2010
Industry
Specialty Average
Net sales $782,000 100.0 %
Cost of goods sold 526,286 65.8
Gross profit 255,714 34.2
Operating expenses 164,220 19.7
Operating income 91,494 14.5
Other expenses 6,256 0.4
Net income $85,238 14.1 %
Specialty Department Stores, Inc.
Balance Sheet Compared with Industry Average
December 31, 2010
...
The document provides information about completing the accounting cycle for a service business, including preparing various financial statements. It discusses the statement of comprehensive income/financial performance and the key elements included such as revenue, expenses, gains/losses, taxes. Sample statements are presented for Mimito Dental Clinic and Mariell's Beauty Salon. The statement of changes in equity and how it differs for sole proprietorships, partnerships, and corporations is explained. Finally, it covers the statement of financial position format and accounts, as well as an overview of the statement of cash flows including the three main activities of operating, investing, and financing.
Assignment Front Sheet Qualification Unit Number And TitleAaron Anyaakuu
The document provides instructions for an assignment assessing a student's understanding of financial accounting and reporting. It includes 5 tasks assessing the student's ability to: 1) understand regulatory frameworks and present on users' needs; 2) prepare financial statements from incomplete records; 3) prepare consolidated financial statements; 4) explain information needs, and prepare financial statements; and 5) interpret financial statements using ratios. The student must submit a single document of 4000-5000 words completing all tasks, citing sources, and declaring their work as authentic. Late submissions will be considered with valid reasons.
This document discusses budgets and variance analysis for managing a business. It defines a budget as a financial plan covering income and expenses. Variance analysis is the process of comparing actual budget outcomes to planned figures to identify favorable and unfavorable variances. The document provides examples of calculating variances for income, expenses, and profit budgets and interpreting the variances to understand factors that led to differences from the planned budget.
Quick Learn: concepts accrual accounting and cash flowEddie Zhong
The document provides an overview of accrual accounting concepts and cash flow statements. It includes examples of accrued income and expenses. It also works through the preparation of an income statement and statement of financial position based on provided transaction information. Key points covered include:
1) Accrual accounting recognizes transactions when they occur rather than when cash is received or paid.
2) Accrued income and expenses are amounts earned or incurred in one period but recorded in another.
3) A cash flow statement records cash inflows and outflows and is separated into operating, investing, and financing activities.
4) Reconciling net income to cash flow from operating activities accounts for non-cash items and changes
The accounting cycle has 8 major steps: 1) recording transactions, 2) posting to ledger accounts, 3) preparing an unadjusted trial balance, 4) making adjusting entries, 5) preparing an adjusted trial balance, 6) closing temporary accounts, 7) preparing post-closing financial statements, and 8) preparing a post-closing trial balance. The example shows the journal entries, ledger accounts, unadjusted trial balance, adjusting entries for depreciation, interest, and unearned revenue, and the closing entries to transfer temporary account balances to retained earnings for Company A.
This chapter discusses calculating profit and loss, and the double entry system for recording expenses and revenues. It explains that profit is calculated as revenue minus expenses, and how profit or loss affects the accounting equation and capital. Separate accounts are used for each type of expense and revenue, with expenses recorded as debits and revenues as credits. The chapter also covers how drawings by the business owner are recorded, decreasing capital rather than being an expense.
ACCOUNTING FOR BUSINESS – ASSIGNMENT SP1 2015PAGE ACCOUNTIN.docxannetnash8266
ACCOUNTING FOR BUSINESS – ASSIGNMENT SP1 2015
PAGE
ACCOUNTING FOR BUSINESS – ASSIGNMENT SP1 2015
ACCT 1008 Accounting for Business
Assignment – Trimester 1, 2015
DUE DATE: 14TH May (Class 1) 15th May (Class 2 and 3)
Student Name:
Student ID
Class Number
1._______________________________________________
________________ ________
2._______________________________________________
________________ ________
All questions are to be completed in this template.
QUES 1
QUES 2
QUES 3
TOTAL
PLEASE DO NOT WRITE IN THESE BOXES – THESE ARE USED TO RECORD YOUR MARKS FOR EACH QUESTION
Question 1 a.
HARRY’S HARDWARE, END OF PERIOD WORKSHEET - YEAR ENDED 30 JUNE 2015
Unadjusted Trial Balance
Adjustments
Adjusted Trial Balance
Income Statement
Balance Sheet
Account Name
Dr
Cr
Dr
Cr
Dr
Cr
Dr
Cr
Dr
Cr
Cash
6 000
Accounts Receivable
36 000
Inventory (1 July 2014)
43 000
Prepaid Rent
1 800
Warehouse Shelving
16 000
Acc’d Depreciation – Warehouse.
3 200
Point of Sale Equipment
4 000
Acc’d Depreciation – Equipment
2 000
Accounts Payable
32 250
H. Smith, Capital (1 July 2014)
58 000
H. Smith, Drawings
12 500
Sales
207 800
Sales Returns & Allowances
2 250
Discount Allowed
400
Purchases
140 200
Discount Received
900
Freight Inwards
2 150
Freight Outwards
1 200
Sales Staff Wages Expense
24 000
Local Government Rates Expense
800
Insurance Expense
3 500
Advertising Expense
3 750
Rent Expense
6 600
304 150
304 150
Profit/Loss
Question 1 Part (b)
Prepare a fully classified Income Statement for the period.
Question 1 Part (c)
Prepare a Statement of Changes in Equity for the period and a fully classified Balance Sheet as at the end of the period.
Question 2:
(Please type your answer to question 2 here)
Question 3:
YORK LTD
Cash Flow Statement
for the year ended 31 December 2015
Cash Flows from Operating Activities
$
$
Receipts from customers
Payments to suppliers & employees
______
Cash generated by operations
Interest paid
Income tax paid
______
_______
Cash Flows from Investing Activities
Interest received
Payment for Equipment
______
_______
Cash Flows from Financing Activities
Proceeds from Share Issue
Dividends paid
______
_______
Net increase / decrease in cash held
Cash at the beginning of the year
_______
Cash at the end of the year
___ ___
Question 3: (Students must show ALL calculations for question 3 or no marks will be awarded for this question)
Calculations
Question 3:
Calculations
.
Due Tues., May 2- 7 questions Big Time Picture Frames h.docxsagarlesley
Due Tues., May 2- 7 questions
Big Time Picture Frames has asked you to determine whether the company's ability to pay current
liabilities and total liabilities improved or deteriorated during 2009. To answer this question, you gather the
following data:
______________________________________________2009__________2008
Cash $52, 000 51, 000
Short-term investments 30,000 --
Net receivables 110,000 120, 000
Inventory 217,000 262,000
Total assets 540,000 490,000
Total current liabilities 265,000 202,000
Long-term note payable 44,000 54,000
Income from operations 165,000 153,000
Interest expense 44,000 37,000
Requirement
1. Compute the following ratios for 2009 and 2008:
a. Current ratio
b. Acid-test ratio
c. Debt ratio
d. Times-interest-earned ratio
a. Calculate the current ratio for both years. (Round your answers to two decimal places.)
2009: nothing
2008: nothing
The Variline Inc., comparative income statement follows. 2010 data are given as needed.
Variline, Inc.
Comparative Income Statement
Years Ended December 31, 2012 and 2011
(Dollars in thousands) 2012 2011 2010
Net sales $176,000 $160,000
Cost of goods sold 93,600 86,000
Selling and general expenses 46,800 41,400
Interest expense 9,600 10,900
Income tax expense 10,200 9,200
Net income $15,800 $12,500
Additional data:
Total assets $201,000 $192,000 $174,000
Common stockholders' equity $96,900 $89,800 $79,500
Preferred dividends $3,400 $3,400 $0
Common shares outstanding during the
year 20,000 20,000 18,000
Requirements
1. Calculate the rate of return on net sales.
2. Calculate the rate of return on total assets.
3. Calculate the rate of return on common stockholders' equity.
4. Calculate the EPS.
5. Did the company's operating performance improve or deteriorate during 2012?
Requirement 1. Calculate the rates of return on net sales for 2012 and 2011. (Round your answers to
three decimal places.)
2012:
nothing
2011: nothing
The Specialty Department Stores, Inc., chief executive officer (CEO) has asked you to compare the
company's profit performance and financial position with the average for the industry. The CEO has
given you the company's income statement and balance sheet, as well as the industry average data for
retailers.
Specialty Department Stores, Inc.
Income Statement Compared with Industry Average
Year Ended December 31, 2010
Industry
Specialty Average
Net sales $782,000 100.0 %
Cost of goods sold 526,286 65.8
Gross profit 255,714 34.2
Operating expenses 164,220 19.7
Operating income 91,494 14.5
Other expenses 6,256 0.4
Net income $85,238 14.1 %
Specialty Department Stores, Inc.
Balance Sheet Compared with Industry Average
December 31, 2010
...
Transaction analysis involves collecting transaction data, determining the effects on accounts in the accounting equation, and recording debits and credits in the general journal. A transaction is an event that results in a change to at least one balance sheet item such as an asset, liability, or equity account. The accounting equation of Assets = Liabilities + Equity must be kept in balance by recording equal debits and credits for each transaction.
This document provides an introduction to accounting concepts for students studying accounting. It discusses key accounting terms like assets, liabilities, expenses and revenue. It also explains the accounting cycle and books of first entry like sales day books, purchases day books and cash books. Transactions are recorded using double-entry bookkeeping and transferred to ledger accounts. The accounting process ends with preparing a trial balance and final accounts.
The document discusses the accounting cycle and how it has been affected by technology. It describes the key steps of the accounting cycle as analyzing transactions, recording transactions through journal entries, summarizing entries in a trial balance, and how computers have allowed these first three steps to be performed more efficiently through automation and processing large amounts of data. The accounting cycle is used to transform business transactions into useful financial information.
This chapter discusses the fundamentals of accounting including its nature, functions, users, principles, and key concepts. Accounting identifies, records, and communicates the financial events of a business. It provides information to internal users like managers and external users like investors and creditors. Companies follow generally accepted accounting principles to prepare four main financial statements - the income statement, balance sheet, statement of owner's equity, and statement of cash flows. The accounting equation forms the basis of recording transactions and showing a company's assets, liabilities, and owner's equity.
1) The document discusses accounting for merchandising activities, including the operating cycle of merchandising companies, income statements, and two approaches to inventory accounting - perpetual and periodic systems.
2) Key aspects covered include the general ledger and use of subsidiary ledgers to provide more detailed accounting information for inventory, receivables, payables and other accounts.
3) The perpetual inventory system allows for continuous updating of inventory balances as transactions occur, using journal entries to record purchases, sales, payments and physical inventory counts.
The document discusses the accounting cycle and related concepts. It covers:
1) Analyzing transactions and their impact on the accounting equation (Assets = Liabilities + Equity). Transactions are recorded through journal entries.
2) Journal entries record transactions in chronological order and are posted to accounts in the general ledger.
3) A trial balance is prepared by listing account balances from the general ledger to check that total debits equal total credits. It helps identify any errors.
4) Technology has streamlined accounting processes but also introduces new risks around data security and reliability of systems.
The document discusses the accounting cycle and related concepts. It covers:
1) Analyzing transactions and determining their impact on the accounting equation (Assets = Liabilities + Equity). This is the first step in the accounting cycle.
2) Recording transactions in a journal, which provides a chronological record. This is the second step. Entries are then posted to accounts in the general ledger.
3) Preparing a trial balance to check that total debits equal total credits after posting. This is the third step.
1. True or false. Unlike a merchandising business, a manufacturingAbbyWhyte974
1. True or false. Unlike a merchandising business, a manufacturing business uses multiple inventory accounts to reflect the cost of raw materials, partially completed goods, and finished goods.
TRUE
FALSE
2.5 points
QUESTION 2
1. For a manufacturing business, the finished goods inventory account reflects the cost of what?
Shipping
Partially completed goods
Completed goods
Raw materials
2.5 points
QUESTION 3
1. Super Goods, an electronics retailer, purchases $80,000 worth of computers from a manufacturer in Taiwan. The terms of the purchase are FOB shipping point. Freight costs total $9,000. The goods are shipped on June 1 and delivered on June 15. On June 1, which two accounts should be debited by Super Goods in the following journal entry? Date Account Dr. Cr. 6-01-XX 80000.00 9000.00 Accounts Payable 89000.00
Inventory and Freight-out
Accounts Receivable and Freight-out
Inventory and Freight-in
Accounts Receivable and Freight-in
2.5 points
QUESTION 4
1. At the time of shipment, goods that are purchased FOB shipping point are
reported on the seller's balance sheet.
considered the responsibility of the buyer.
designated as freight-out.
categorized as partially completed inventory.
2.5 points
QUESTION 5
1. On February 15, a buyer purchases $30,000 worth of goods from a manufacturer. The manufacturer offers the buyer a 3% discount ($900) if payment for the goods is made within 10 days. The buyer pays for the merchandise on February 20. In a journal entry, the seller should debit ________ and credit ________ for $900.
Sales; Purchase Discounts
Accounts Receivable; Sales
Sales; Accounts Receivable
Accounts Payable; Inventory
2.5 points
QUESTION 6
1. A buyer receives a sales discount from a seller for paying for purchased goods within a specific period of time. In what way does the sales discount affects the buyer?
Reducing freight-in costs
Reducing the cost of inventory
Increasing freight-out costs
Increasing the cost of inventory
2.5 points
QUESTION 7
1. For a manufacturing business, the __________ inventory account reflects the cost of products that have been manufactured and are ready to be sold.
Raw materials
Work-in-process
Freight-in
Finished goods
2.5 points
QUESTION 8
1. Which term refers to goods that a merchandising business purchases and resells?
Inputs
Frieght
Supplies
Inventory
2.5 points
QUESTION 9
1. On February 15, a buyer purchases $10,000 worth of goods from a manufacturer, who spent $5,000 to manufacture the goods. The terms of sale are FOB shipping point, and shipping costs are $800. The goods will be shipped on June 1. The manufacturer must make two journal entries on June 1. In the second journal entry, the manufacturer should debit ________ and credit ________. Date Account Dr. Cr. 6-01-XX Accounts Receivable 10,000.00 Cash 800.00 Sales 10,000.00 Date Account Dr. Cr. 6-01-XX 5,000.00 5,000.00
Cash; Cost of Goods Sold
Cost of Goods Sold; ...
1. True or false. Unlike a merchandising business, a manufacturingSantosConleyha
1. True or false. Unlike a merchandising business, a manufacturing business uses multiple inventory accounts to reflect the cost of raw materials, partially completed goods, and finished goods.
TRUE
FALSE
2.5 points
QUESTION 2
1. For a manufacturing business, the finished goods inventory account reflects the cost of what?
Shipping
Partially completed goods
Completed goods
Raw materials
2.5 points
QUESTION 3
1. Super Goods, an electronics retailer, purchases $80,000 worth of computers from a manufacturer in Taiwan. The terms of the purchase are FOB shipping point. Freight costs total $9,000. The goods are shipped on June 1 and delivered on June 15. On June 1, which two accounts should be debited by Super Goods in the following journal entry? Date Account Dr. Cr. 6-01-XX 80000.00 9000.00 Accounts Payable 89000.00
Inventory and Freight-out
Accounts Receivable and Freight-out
Inventory and Freight-in
Accounts Receivable and Freight-in
2.5 points
QUESTION 4
1. At the time of shipment, goods that are purchased FOB shipping point are
reported on the seller's balance sheet.
considered the responsibility of the buyer.
designated as freight-out.
categorized as partially completed inventory.
2.5 points
QUESTION 5
1. On February 15, a buyer purchases $30,000 worth of goods from a manufacturer. The manufacturer offers the buyer a 3% discount ($900) if payment for the goods is made within 10 days. The buyer pays for the merchandise on February 20. In a journal entry, the seller should debit ________ and credit ________ for $900.
Sales; Purchase Discounts
Accounts Receivable; Sales
Sales; Accounts Receivable
Accounts Payable; Inventory
2.5 points
QUESTION 6
1. A buyer receives a sales discount from a seller for paying for purchased goods within a specific period of time. In what way does the sales discount affects the buyer?
Reducing freight-in costs
Reducing the cost of inventory
Increasing freight-out costs
Increasing the cost of inventory
2.5 points
QUESTION 7
1. For a manufacturing business, the __________ inventory account reflects the cost of products that have been manufactured and are ready to be sold.
Raw materials
Work-in-process
Freight-in
Finished goods
2.5 points
QUESTION 8
1. Which term refers to goods that a merchandising business purchases and resells?
Inputs
Frieght
Supplies
Inventory
2.5 points
QUESTION 9
1. On February 15, a buyer purchases $10,000 worth of goods from a manufacturer, who spent $5,000 to manufacture the goods. The terms of sale are FOB shipping point, and shipping costs are $800. The goods will be shipped on June 1. The manufacturer must make two journal entries on June 1. In the second journal entry, the manufacturer should debit ________ and credit ________. Date Account Dr. Cr. 6-01-XX Accounts Receivable 10,000.00 Cash 800.00 Sales 10,000.00 Date Account Dr. Cr. 6-01-XX 5,000.00 5,000.00
Cash; Cost of Goods Sold
Cost of Goods Sold; ...
SOS Please please please help on this problem!!!!!!!!!!!!!!!!!!!!!! .pdfFOREVERPRODUCTCHD
SOS Please please please help on this problem!!!!!!!!!!!!!!!!!!!!!! :) Closing Entries and the
Postclosing Trial Balance 192 CHAPTER 6 Mini-Practice Set 1 Service Business Accounting
Cycle Eli\'s Consulting Services ing principles and This project will give you an opportunity to
apply your knowledge of accounting principles and procedures by handling all the accounting
work of Eli\'s Consulting Services for the month o January 2020. Assume that you are the chief
accountant for Eli\'s Consulting Services, During January, the busi ness will use the same types
of records and procedures that you learned about in Chapters 1 through 6. The chart of accounts
for Eli\'s Consulting Services has been expanded to include a few new accounts. Follow the
instructions to complete the accounting records for the month of January. INTRODUCTION
Eli\'s Consulting Services Chart of Accounts Revenue 401 Fees Income Assets 101 Cash 111
Accounts Receivable 121 Supplies 134 Prepaid Insurance 137 Prepaid Rent 141 Equipment 142
Accumulated Depreciation Equipment Liabilities 202 Accounts Payable Expenses 511 Salaries
Expense 514 Utilities Expense 517 Supplies Expense 520 Rent Expense 523 Depreciation
Expense-Equipment 526 Advertising Expense 529 Maintenance Expense 532 Telephone
Expense 535 Insurance Expense Owner\'s Equity 301 Trayton Eli, Capital 302 Trayton Eli,
Drawing 309 Income Summary INSTRUCTIONS 1. Open the general ledger accounts and enter
the balances for January 1, 2020. Obtain the necessary figures from the postclosing trial balance
prepared on December 31, 2019, which appears in Figure 6.3. 2. Analyze each transaction and
record it in the general journal. Use page 3 to begin January\'s transactions. 3. Post the
transactions to the general ledger accounts. 4. Prepare the Trial Balance section of the worksheet.
5. Prepare the Adjustments section of the worksheet. a. Compute and record the adjustment for
supplies used during the month. An inventory taken on January 31 showed supplies of $5,200 on
hand. b. Compute and record the adjustment for expired insurance for the month. c. Record the
adjustment for one month of expired rent of $4,000. d. Record the adjustment for depreciation of
$183 on the old equipment for the month. The first adjustment for depreciation for the new
equipment will be recorded in February, 6. Complete the worksheet. 7. Prepare an income
statement for the month. 8. Prepare a statement of owner\'s equity.
Solution
Journal Entries
Date
Account Title
Debit
Credit
2-Jan
Supplies
7000
Cash
7000
7-Jan
Cash
20000
Accounts receivable
5000
Fees Income
25000
2-Jan
Insurance expense
8400
Cash
8400
12-Jan
Cash
4000
Accounts receivable
4000
Advertising expense
3600
Cash
3600
Cash
20700
Accounts receivable
2300
Fees Income
23000
13-Jan
Cash
4500
Accounts receivable
4500
14-Jan
Cash
750
Supplies
750
20-Jan
Supplies
5000
Accounts Payable
5000
20-Jan
Cash
12500
Accounts receivable
3500
Fees Income
16000
20-Jan
Cash
5600
Accounts receivable
5600
21-Jan
Ma.
Part 3-4 Posting and Trial Balance PreparationMichael Alonzo
The document discusses ledgers, which are used by companies to maintain account balances and track changes. It explains that the general ledger contains all asset, liability, and equity accounts. Journal entries are posted to the ledger accounts to update them. Ledgers use a three-column format with debit, credit, and balance columns to track transactions for each account.
Introduction to Accounting Assessment 2Information· The tothildredzr1di
Introduction to Accounting Assessment 2
Information:
· The total marks available for this assignment is 100. The assessment is 70% of your overall module grade.
· The total word count for this assignment (not including figures, appendices and calculations) is
1500 (+ or- 10%).
A breakdown of the count for each part of the report is given below as guidance.
· The deadline for submitting your assignment is
Friday 7thDecember 2018 at 1155pm.
Please upload to Study Direct
· Assignments received after that time will be subject to the rules for late submission
Submission Format Instructions
· Please ensure that all submissions includes the assignment title – in this case:
Introduction to Accounting 2:
Zhetong General Retailers
· All work should be word processed and typed in Arial font, 11 point with one and a half line spacing with a minimum of 2.5cm margin down both sides of the page.
· You are expected to show evidence of reading by including both in text reference and a reference list after end of the report.
Following these instructions is important as marks are awarded for presentation
Please note:5 marks are available for presentation and 5 for English
Assignment Brief:
Information about ….
Zhetong General Retailers has been operating as a sole trader in Brighton selling food and other household items the past 5 years. A local rival retailer, Ahan is has been operating successfully but due the retirement of the owner, the business is being sold.
Zhetong approaches you with the financial statements of Ahan. He wants you to advise him on whether he should buy the business based on its performance and financial position (Appendix 1). He also provides you with a set of information about Ahan forecasted cash flow for 2019 (Appendix 2).
In addition, there two other investment opportunities for Zhetong, that are given in appendix 3 that are available.
You are required to write a report to Zhetong advising him on the three options available to him as follows:
1. Assess Zhetong’s financial performance for the year ended 31stOctober 2018. To what extent should Zhetong rely on other information other than accounting ratios to assess the performance of Ahan business?
(800words)
2. Zhetong would like you to prepare Ahan’s cash flow forecast for 2019 using the information in
appendix 2
and explain to him the extent to which the ash flow forecast assist Zhetong to assess the decision to purchase Ahan’s business.
(350 words)
3. Perform an investment appraisal, using the payback period, accounting rat of return and net present value, of the two other options available to Zhetong and advise him of the best option he could take. Justify your advice.
(350 words)
Remember
All workings must be submitted as appendices and referenced in the report.
Additional information on the business provided in appendices below consists of:
1. Financial statements for year ending 31stOctober 2018
2. Planned cash movements for year en ...
1) The document describes the accounting cycle and accrual accounting. It explains adjusting entries for unrecorded receivables, liabilities, prepaid expenses, and unearned revenues.
2) The accounting cycle includes preparing financial statements and closing entries to transfer nominal account balances to the income statement or retained earnings.
3) Adjusting entries are made for transactions that occurred in the current period but were not recorded until the next period. This allows financial reports to reflect accrual-basis accounting.
Stu Ch04 Completing The Accounting Cycleguest441011
1) The document describes the accounting cycle and accrual accounting. It explains adjusting entries for unrecorded receivables, liabilities, prepared expenses, and unearned revenues.
2) The accounting cycle includes preparing financial statements and notes, and the closing process of closing revenue, expense, and dividend accounts to retained earnings.
3) Real and nominal accounts are closed in the accounting cycle to determine net income and retained earnings for the period.
The accounting cycle is used to record business transactions throughout a period and ensure accurate financial reporting. It includes recording transactions, journal entries, posting to ledger accounts, preparing a trial balance, making adjustments, preparing a post-closing trial balance, and issuing financial statements. Errors can be corrected through adjusting journal entries made before closing entries transfer temporary account balances to prepare for the next accounting period.
University of latvia subject Financial accounting pro Inna RomānovaFarsna Faiz
Introduction to Financial Accounting
2. Major Financial Statements: Balance Sheet, Income
Statement, Cash Flow Statement
3. Construction of Financial Statements
4. Financial Statement Analysis
5. Introduction to Financial Management
6. Raising Capital. Sources of Financial Capital
7. Cost of Capital. Capital Structure
8. Asset /Liability Management
Accounting is the system that records and reports financial information about a business. It identifies, records, and communicates economic events to users. The chapter outlines key accounting concepts like the accounting equation, direct and indirect costs, fixed and variable costs, and the difference between inventoriable and period costs. It explains the four main financial statements - income statement, balance sheet, statement of owner's equity, and statement of cash flows - and how they are used to report on a business's financial performance and position.
This document contains 7 budgeting problems. Problem 1 requires preparing a production budget and summary production cost budget for 6 months. Problem 2 requires preparing a production budget (quantitative) and material purchase budget (quantitative). Problem 3 requires calculating a material purchases budget and wages budget. Problem 4 requires preparing a sales overhead budget for 3 months. Problem 5 requires preparing an estimate of cash position for 3 months. Problem 6 requires preparing a forecast statement to show the effect of a proposed price reduction. Problem 7 requires preparing flexible budgets for administration, selling, and distribution costs at different capacity levels.
The document discusses various topics related to reporting and analyzing receivables:
1. It identifies the different types of receivables as accounts receivable, notes receivable, and other receivables.
2. It explains how accounts receivable are recognized in accounts through journal entries and discusses methods for valuing and accounting for bad debts, including the allowance and direct write-off methods.
3. It describes how notes receivable are recorded through journal entries, including recognizing, valuing, and disposing of notes receivable.
Transaction analysis involves collecting transaction data, determining the effects on accounts in the accounting equation, and recording debits and credits in the general journal. A transaction is an event that results in a change to at least one balance sheet item such as an asset, liability, or equity account. The accounting equation of Assets = Liabilities + Equity must be kept in balance by recording equal debits and credits for each transaction.
This document provides an introduction to accounting concepts for students studying accounting. It discusses key accounting terms like assets, liabilities, expenses and revenue. It also explains the accounting cycle and books of first entry like sales day books, purchases day books and cash books. Transactions are recorded using double-entry bookkeeping and transferred to ledger accounts. The accounting process ends with preparing a trial balance and final accounts.
The document discusses the accounting cycle and how it has been affected by technology. It describes the key steps of the accounting cycle as analyzing transactions, recording transactions through journal entries, summarizing entries in a trial balance, and how computers have allowed these first three steps to be performed more efficiently through automation and processing large amounts of data. The accounting cycle is used to transform business transactions into useful financial information.
This chapter discusses the fundamentals of accounting including its nature, functions, users, principles, and key concepts. Accounting identifies, records, and communicates the financial events of a business. It provides information to internal users like managers and external users like investors and creditors. Companies follow generally accepted accounting principles to prepare four main financial statements - the income statement, balance sheet, statement of owner's equity, and statement of cash flows. The accounting equation forms the basis of recording transactions and showing a company's assets, liabilities, and owner's equity.
1) The document discusses accounting for merchandising activities, including the operating cycle of merchandising companies, income statements, and two approaches to inventory accounting - perpetual and periodic systems.
2) Key aspects covered include the general ledger and use of subsidiary ledgers to provide more detailed accounting information for inventory, receivables, payables and other accounts.
3) The perpetual inventory system allows for continuous updating of inventory balances as transactions occur, using journal entries to record purchases, sales, payments and physical inventory counts.
The document discusses the accounting cycle and related concepts. It covers:
1) Analyzing transactions and their impact on the accounting equation (Assets = Liabilities + Equity). Transactions are recorded through journal entries.
2) Journal entries record transactions in chronological order and are posted to accounts in the general ledger.
3) A trial balance is prepared by listing account balances from the general ledger to check that total debits equal total credits. It helps identify any errors.
4) Technology has streamlined accounting processes but also introduces new risks around data security and reliability of systems.
The document discusses the accounting cycle and related concepts. It covers:
1) Analyzing transactions and determining their impact on the accounting equation (Assets = Liabilities + Equity). This is the first step in the accounting cycle.
2) Recording transactions in a journal, which provides a chronological record. This is the second step. Entries are then posted to accounts in the general ledger.
3) Preparing a trial balance to check that total debits equal total credits after posting. This is the third step.
1. True or false. Unlike a merchandising business, a manufacturingAbbyWhyte974
1. True or false. Unlike a merchandising business, a manufacturing business uses multiple inventory accounts to reflect the cost of raw materials, partially completed goods, and finished goods.
TRUE
FALSE
2.5 points
QUESTION 2
1. For a manufacturing business, the finished goods inventory account reflects the cost of what?
Shipping
Partially completed goods
Completed goods
Raw materials
2.5 points
QUESTION 3
1. Super Goods, an electronics retailer, purchases $80,000 worth of computers from a manufacturer in Taiwan. The terms of the purchase are FOB shipping point. Freight costs total $9,000. The goods are shipped on June 1 and delivered on June 15. On June 1, which two accounts should be debited by Super Goods in the following journal entry? Date Account Dr. Cr. 6-01-XX 80000.00 9000.00 Accounts Payable 89000.00
Inventory and Freight-out
Accounts Receivable and Freight-out
Inventory and Freight-in
Accounts Receivable and Freight-in
2.5 points
QUESTION 4
1. At the time of shipment, goods that are purchased FOB shipping point are
reported on the seller's balance sheet.
considered the responsibility of the buyer.
designated as freight-out.
categorized as partially completed inventory.
2.5 points
QUESTION 5
1. On February 15, a buyer purchases $30,000 worth of goods from a manufacturer. The manufacturer offers the buyer a 3% discount ($900) if payment for the goods is made within 10 days. The buyer pays for the merchandise on February 20. In a journal entry, the seller should debit ________ and credit ________ for $900.
Sales; Purchase Discounts
Accounts Receivable; Sales
Sales; Accounts Receivable
Accounts Payable; Inventory
2.5 points
QUESTION 6
1. A buyer receives a sales discount from a seller for paying for purchased goods within a specific period of time. In what way does the sales discount affects the buyer?
Reducing freight-in costs
Reducing the cost of inventory
Increasing freight-out costs
Increasing the cost of inventory
2.5 points
QUESTION 7
1. For a manufacturing business, the __________ inventory account reflects the cost of products that have been manufactured and are ready to be sold.
Raw materials
Work-in-process
Freight-in
Finished goods
2.5 points
QUESTION 8
1. Which term refers to goods that a merchandising business purchases and resells?
Inputs
Frieght
Supplies
Inventory
2.5 points
QUESTION 9
1. On February 15, a buyer purchases $10,000 worth of goods from a manufacturer, who spent $5,000 to manufacture the goods. The terms of sale are FOB shipping point, and shipping costs are $800. The goods will be shipped on June 1. The manufacturer must make two journal entries on June 1. In the second journal entry, the manufacturer should debit ________ and credit ________. Date Account Dr. Cr. 6-01-XX Accounts Receivable 10,000.00 Cash 800.00 Sales 10,000.00 Date Account Dr. Cr. 6-01-XX 5,000.00 5,000.00
Cash; Cost of Goods Sold
Cost of Goods Sold; ...
1. True or false. Unlike a merchandising business, a manufacturingSantosConleyha
1. True or false. Unlike a merchandising business, a manufacturing business uses multiple inventory accounts to reflect the cost of raw materials, partially completed goods, and finished goods.
TRUE
FALSE
2.5 points
QUESTION 2
1. For a manufacturing business, the finished goods inventory account reflects the cost of what?
Shipping
Partially completed goods
Completed goods
Raw materials
2.5 points
QUESTION 3
1. Super Goods, an electronics retailer, purchases $80,000 worth of computers from a manufacturer in Taiwan. The terms of the purchase are FOB shipping point. Freight costs total $9,000. The goods are shipped on June 1 and delivered on June 15. On June 1, which two accounts should be debited by Super Goods in the following journal entry? Date Account Dr. Cr. 6-01-XX 80000.00 9000.00 Accounts Payable 89000.00
Inventory and Freight-out
Accounts Receivable and Freight-out
Inventory and Freight-in
Accounts Receivable and Freight-in
2.5 points
QUESTION 4
1. At the time of shipment, goods that are purchased FOB shipping point are
reported on the seller's balance sheet.
considered the responsibility of the buyer.
designated as freight-out.
categorized as partially completed inventory.
2.5 points
QUESTION 5
1. On February 15, a buyer purchases $30,000 worth of goods from a manufacturer. The manufacturer offers the buyer a 3% discount ($900) if payment for the goods is made within 10 days. The buyer pays for the merchandise on February 20. In a journal entry, the seller should debit ________ and credit ________ for $900.
Sales; Purchase Discounts
Accounts Receivable; Sales
Sales; Accounts Receivable
Accounts Payable; Inventory
2.5 points
QUESTION 6
1. A buyer receives a sales discount from a seller for paying for purchased goods within a specific period of time. In what way does the sales discount affects the buyer?
Reducing freight-in costs
Reducing the cost of inventory
Increasing freight-out costs
Increasing the cost of inventory
2.5 points
QUESTION 7
1. For a manufacturing business, the __________ inventory account reflects the cost of products that have been manufactured and are ready to be sold.
Raw materials
Work-in-process
Freight-in
Finished goods
2.5 points
QUESTION 8
1. Which term refers to goods that a merchandising business purchases and resells?
Inputs
Frieght
Supplies
Inventory
2.5 points
QUESTION 9
1. On February 15, a buyer purchases $10,000 worth of goods from a manufacturer, who spent $5,000 to manufacture the goods. The terms of sale are FOB shipping point, and shipping costs are $800. The goods will be shipped on June 1. The manufacturer must make two journal entries on June 1. In the second journal entry, the manufacturer should debit ________ and credit ________. Date Account Dr. Cr. 6-01-XX Accounts Receivable 10,000.00 Cash 800.00 Sales 10,000.00 Date Account Dr. Cr. 6-01-XX 5,000.00 5,000.00
Cash; Cost of Goods Sold
Cost of Goods Sold; ...
SOS Please please please help on this problem!!!!!!!!!!!!!!!!!!!!!! .pdfFOREVERPRODUCTCHD
SOS Please please please help on this problem!!!!!!!!!!!!!!!!!!!!!! :) Closing Entries and the
Postclosing Trial Balance 192 CHAPTER 6 Mini-Practice Set 1 Service Business Accounting
Cycle Eli\'s Consulting Services ing principles and This project will give you an opportunity to
apply your knowledge of accounting principles and procedures by handling all the accounting
work of Eli\'s Consulting Services for the month o January 2020. Assume that you are the chief
accountant for Eli\'s Consulting Services, During January, the busi ness will use the same types
of records and procedures that you learned about in Chapters 1 through 6. The chart of accounts
for Eli\'s Consulting Services has been expanded to include a few new accounts. Follow the
instructions to complete the accounting records for the month of January. INTRODUCTION
Eli\'s Consulting Services Chart of Accounts Revenue 401 Fees Income Assets 101 Cash 111
Accounts Receivable 121 Supplies 134 Prepaid Insurance 137 Prepaid Rent 141 Equipment 142
Accumulated Depreciation Equipment Liabilities 202 Accounts Payable Expenses 511 Salaries
Expense 514 Utilities Expense 517 Supplies Expense 520 Rent Expense 523 Depreciation
Expense-Equipment 526 Advertising Expense 529 Maintenance Expense 532 Telephone
Expense 535 Insurance Expense Owner\'s Equity 301 Trayton Eli, Capital 302 Trayton Eli,
Drawing 309 Income Summary INSTRUCTIONS 1. Open the general ledger accounts and enter
the balances for January 1, 2020. Obtain the necessary figures from the postclosing trial balance
prepared on December 31, 2019, which appears in Figure 6.3. 2. Analyze each transaction and
record it in the general journal. Use page 3 to begin January\'s transactions. 3. Post the
transactions to the general ledger accounts. 4. Prepare the Trial Balance section of the worksheet.
5. Prepare the Adjustments section of the worksheet. a. Compute and record the adjustment for
supplies used during the month. An inventory taken on January 31 showed supplies of $5,200 on
hand. b. Compute and record the adjustment for expired insurance for the month. c. Record the
adjustment for one month of expired rent of $4,000. d. Record the adjustment for depreciation of
$183 on the old equipment for the month. The first adjustment for depreciation for the new
equipment will be recorded in February, 6. Complete the worksheet. 7. Prepare an income
statement for the month. 8. Prepare a statement of owner\'s equity.
Solution
Journal Entries
Date
Account Title
Debit
Credit
2-Jan
Supplies
7000
Cash
7000
7-Jan
Cash
20000
Accounts receivable
5000
Fees Income
25000
2-Jan
Insurance expense
8400
Cash
8400
12-Jan
Cash
4000
Accounts receivable
4000
Advertising expense
3600
Cash
3600
Cash
20700
Accounts receivable
2300
Fees Income
23000
13-Jan
Cash
4500
Accounts receivable
4500
14-Jan
Cash
750
Supplies
750
20-Jan
Supplies
5000
Accounts Payable
5000
20-Jan
Cash
12500
Accounts receivable
3500
Fees Income
16000
20-Jan
Cash
5600
Accounts receivable
5600
21-Jan
Ma.
Part 3-4 Posting and Trial Balance PreparationMichael Alonzo
The document discusses ledgers, which are used by companies to maintain account balances and track changes. It explains that the general ledger contains all asset, liability, and equity accounts. Journal entries are posted to the ledger accounts to update them. Ledgers use a three-column format with debit, credit, and balance columns to track transactions for each account.
Introduction to Accounting Assessment 2Information· The tothildredzr1di
Introduction to Accounting Assessment 2
Information:
· The total marks available for this assignment is 100. The assessment is 70% of your overall module grade.
· The total word count for this assignment (not including figures, appendices and calculations) is
1500 (+ or- 10%).
A breakdown of the count for each part of the report is given below as guidance.
· The deadline for submitting your assignment is
Friday 7thDecember 2018 at 1155pm.
Please upload to Study Direct
· Assignments received after that time will be subject to the rules for late submission
Submission Format Instructions
· Please ensure that all submissions includes the assignment title – in this case:
Introduction to Accounting 2:
Zhetong General Retailers
· All work should be word processed and typed in Arial font, 11 point with one and a half line spacing with a minimum of 2.5cm margin down both sides of the page.
· You are expected to show evidence of reading by including both in text reference and a reference list after end of the report.
Following these instructions is important as marks are awarded for presentation
Please note:5 marks are available for presentation and 5 for English
Assignment Brief:
Information about ….
Zhetong General Retailers has been operating as a sole trader in Brighton selling food and other household items the past 5 years. A local rival retailer, Ahan is has been operating successfully but due the retirement of the owner, the business is being sold.
Zhetong approaches you with the financial statements of Ahan. He wants you to advise him on whether he should buy the business based on its performance and financial position (Appendix 1). He also provides you with a set of information about Ahan forecasted cash flow for 2019 (Appendix 2).
In addition, there two other investment opportunities for Zhetong, that are given in appendix 3 that are available.
You are required to write a report to Zhetong advising him on the three options available to him as follows:
1. Assess Zhetong’s financial performance for the year ended 31stOctober 2018. To what extent should Zhetong rely on other information other than accounting ratios to assess the performance of Ahan business?
(800words)
2. Zhetong would like you to prepare Ahan’s cash flow forecast for 2019 using the information in
appendix 2
and explain to him the extent to which the ash flow forecast assist Zhetong to assess the decision to purchase Ahan’s business.
(350 words)
3. Perform an investment appraisal, using the payback period, accounting rat of return and net present value, of the two other options available to Zhetong and advise him of the best option he could take. Justify your advice.
(350 words)
Remember
All workings must be submitted as appendices and referenced in the report.
Additional information on the business provided in appendices below consists of:
1. Financial statements for year ending 31stOctober 2018
2. Planned cash movements for year en ...
1) The document describes the accounting cycle and accrual accounting. It explains adjusting entries for unrecorded receivables, liabilities, prepaid expenses, and unearned revenues.
2) The accounting cycle includes preparing financial statements and closing entries to transfer nominal account balances to the income statement or retained earnings.
3) Adjusting entries are made for transactions that occurred in the current period but were not recorded until the next period. This allows financial reports to reflect accrual-basis accounting.
Stu Ch04 Completing The Accounting Cycleguest441011
1) The document describes the accounting cycle and accrual accounting. It explains adjusting entries for unrecorded receivables, liabilities, prepared expenses, and unearned revenues.
2) The accounting cycle includes preparing financial statements and notes, and the closing process of closing revenue, expense, and dividend accounts to retained earnings.
3) Real and nominal accounts are closed in the accounting cycle to determine net income and retained earnings for the period.
The accounting cycle is used to record business transactions throughout a period and ensure accurate financial reporting. It includes recording transactions, journal entries, posting to ledger accounts, preparing a trial balance, making adjustments, preparing a post-closing trial balance, and issuing financial statements. Errors can be corrected through adjusting journal entries made before closing entries transfer temporary account balances to prepare for the next accounting period.
University of latvia subject Financial accounting pro Inna RomānovaFarsna Faiz
Introduction to Financial Accounting
2. Major Financial Statements: Balance Sheet, Income
Statement, Cash Flow Statement
3. Construction of Financial Statements
4. Financial Statement Analysis
5. Introduction to Financial Management
6. Raising Capital. Sources of Financial Capital
7. Cost of Capital. Capital Structure
8. Asset /Liability Management
Accounting is the system that records and reports financial information about a business. It identifies, records, and communicates economic events to users. The chapter outlines key accounting concepts like the accounting equation, direct and indirect costs, fixed and variable costs, and the difference between inventoriable and period costs. It explains the four main financial statements - income statement, balance sheet, statement of owner's equity, and statement of cash flows - and how they are used to report on a business's financial performance and position.
This document contains 7 budgeting problems. Problem 1 requires preparing a production budget and summary production cost budget for 6 months. Problem 2 requires preparing a production budget (quantitative) and material purchase budget (quantitative). Problem 3 requires calculating a material purchases budget and wages budget. Problem 4 requires preparing a sales overhead budget for 3 months. Problem 5 requires preparing an estimate of cash position for 3 months. Problem 6 requires preparing a forecast statement to show the effect of a proposed price reduction. Problem 7 requires preparing flexible budgets for administration, selling, and distribution costs at different capacity levels.
The document discusses various topics related to reporting and analyzing receivables:
1. It identifies the different types of receivables as accounts receivable, notes receivable, and other receivables.
2. It explains how accounts receivable are recognized in accounts through journal entries and discusses methods for valuing and accounting for bad debts, including the allowance and direct write-off methods.
3. It describes how notes receivable are recorded through journal entries, including recognizing, valuing, and disposing of notes receivable.
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3. Learning objectives
Transaction processing overview
1. Describe the four parts of the data processing cycle and the major
activities.
2. Discuss the type of information that an AIS can provide.
3. Describe the ways information is stored in computer-based
information systems.
4. Describe documents and procedures used to collect and process
transaction data.
Systems documentation techniques
5. Prepare and use data flow diagrams, flowcharts and business
process diagrams to understand, evaluate and document information
systems.
4.
5. The Data Life Cycle
Re-cap (Lecture 1): what is data?
6. The Data Life Cycle (Cont’d)
LO1
Planning
Sourcing and Extraction
Storage and Security
Analysis and Discovery Processing and Distribution
Repurposing
Archiving and Disposal
Areas of particular interest to accountants and financial professionals
Other areas of data life cycle
7. Data Life Cycle – Analysis
and Discovery
Data Input
LO1
Historically, responsibility for the data at various stages of the lifecycle
was entrusted to IT and/or Operations departments and, when data
tasks became more complex, business analysts and/or data
architects would have to get involved.
More recently, however, there has been a growing demand for more
direct involvement in data-related activities from users across the
business. Note, for instance, the ‘Analysis and Discovery’ area, where
the ‘Discovery’ part highlights a rapidly developing trend for giving end
users direct access to large complex data sets via new powerful
business intelligence and visualisation tools. Such tools also allow
dynamic user-driven reporting, and this will be of particular interest to
accountants, in particular with the expected uptake of integrated
reporting.
(ACCA, 2015)
9. Practise: what source documents are
used to captured data for revenue
process?
Activity Source document
Take customer order
Deliver an order to customer
Receive cash from customer
Make changes to customer
balance
LO4
Sourcing and Extraction
10. Practise: what source documents are
used to captured data for revenue
process?
Activity Source document
Take customer order
Deliver an order to customer
Receive cash from customer
Make changes to customer
balance
LO4
Sales order
Delivery note
Remittance advice
Receipts
Credit note
Sourcing and Extraction
11. Methods of storing data
Journals: a record of _ _ _ _ _ _ _ _ _ _ _data, showing the
accounts and amounts to be debited and credited in the ledger.
Ledgers: an a_ _ _ _ _ _ book that contains data for every asset,
liability, equity, income and expense account of the organisation.
Coding technique: data in l_ _ _ _ _ _ is organised _ _ _ _ _ _ _ _
_ using this method. Coding is the _ _ _ _ _ _ _ _ _ _assignment of
numbers or letters to items to c_ _ _ _ _ _ _ and organise them.
Chart of accounts: a listing of all the numbers assigned to balance
sheet and income statement accounts. The account numbers allow
data to be
_ _ _ _ _ , _ _ _ _ _ _ _ _ _ _, and _ _ _ _ _ _ _into the accounts.
They also _ _ _ _ _ _ _ _ _ _ financial statement and report p_ _ _ _
_ _ _ _ _ _.
Audit trail: a _ _ _ _that allows a transaction to be _ _ _ _ _
LO3
transaction
account
ledgers logically
systematic
classify
coded classified entered
facilitate preparation
path traced
Processing and Distribution
12. Why do we prepare
journals?
Source: Sage (UK) Limited, 2018, Sage Accounts 50 Course Notes, Book One – Unit
Three, p27
LO3
Processing and Distribution
13. Recording and posting cash sale
journal
Sales Journal: the company made two cash sales.
Date Journal
No.
Invoice
Number
Account
Number
Account Name Amount (£)
01/01/2019 SJ001 151 5000 Sales - stationery 200.00
01/01/2019 SJ001 152 5001 Sales – furniture 158.55
TOTAL 358.55
General ledger: Sales (revenue increases by
£358.55)
Date Description Post
reference
Balanc
e (£)
01/01/2019 Sales SJ001 358.55
General ledger: Cash (cash balance increases by
£358.55)
Date Description Post
referenc
e
Balance
(£)
01/01/2019 Sales SJ001 358.55
LO3
Processing and Distribution
14. Practice: journal (Task AJ, Unit 3,
Sage)
LO3
At the start of the new financial year in July, the owner of the business
takes £40 in office furniture (plus VAT at 20%) for his own use and £5 in
stamps.
Enter these transactions by the use of a journal. The Date for the journal
is 01/07/2020. The Reference is Private Use & Exps. The Detail you enter
should explain the transactions. • Enter - £40.00 for Stationery plus VAT at
20%, to reflect the goods taken for private use. • Enter - £5.00 for Postage
(there is no VAT on stamps) to reflect the private element of postage
purchases.
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
5000 – furniture
sales
01/07/202
0
7501 – stamps
01/07/202
0
2200 – VAT
01/07/202
0
3050 - Drawings
15. Practice: journal (Task AJ, Unit 3,
Sage)
At the start of the new financial year in July, the owner of the business
takes £40 in office furniture (plus VAT at 20%) for his own use and £5 in
stamps.
Enter these transactions by the use of a journal. The Date for the journal
is 01/07/2020. The Reference is Private Use & Exps. The Detail you enter
should explain the transactions. • Enter - £40.00 for Stationery plus VAT at
20%, to reflect the goods taken for private use. • Enter - £5.00 for Postage
(there is no VAT on stamps) to reflect the private element of postage
purchases.
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
Private Use &
Exps
5000 – furniture
sales
40.00
01/07/202
0
Private Use &
Exps
7501 – stamps 5.00
01/07/202
0
Private Use &
Exps
2200 – VAT 8.00
01/07/202
0
Private Use &
Exps
3050 - Drawings 53.00
16. Practice: journal (Self-Test Activity Thirty, Unit 3,
Sage)
The owner of the business informs you that he made an error and did not
take £40 of office furniture; it was in fact Stationery that he used and further,
that he used £2.00 in stamps and not £5.00.
You are asked to Reverse the first entry using the Reversals option in the
Nominal Ledger and make the correct journal for Stationery and the right
amount of £2.00 for Postage.
The Date of the transaction is 01/07/2020. (You can use the automated
Journal Reversal option for this process).
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
Private Use &
Exps
5000 – furniture
sales
40.00
01/07/202
0
Private Use &
Exps
7501 – stamps 5.00
01/07/202
0
Private Use &
Exps
2200 – VAT 8.00
01/07/202
0
Private Use &
Exps
3050 - Drawings 53.00
1. £40 should be in
5001 – stationery
sales
2. Stamps account is
overstated by £3.
3. Overall drawings is
overstated by £3.
17. Practice: journal (Self-Test Activity Thirty, Unit 3,
Sage)
“You are asked to Reverse the first entry using the Reversals option in
the Nominal Ledger and make the correct journal for Stationery and
the right amount of £2.00 for Postage. “
1. Reversal journal: opposite entry to the
original.
Transaction
Date
Reference Nominal code Debit (£) Credit (£)
01/07/2020 Private Use & Exps 5000 – furniture sales 40.00
01/07/2020 Private Use & Exps 2200 – VAT 8.00
01/07/2020 Private Use & Exps 3050 - Drawings 48.00
Transaction
Date
Reference Nominal code Debit (£) Credit (£)
01/07/2020 Private Use & Exps 5000 – furniture sales
01/07/2020 Private Use & Exps 2200 – VAT
01/07/2020 Private Use & Exps 3050 - Drawings
Original
Reversal Journal
18. Practice: journal (Self-Test Activity Thirty, Unit 3,
Sage)
“You are asked to Reverse the first entry using the Reversals option in
the Nominal Ledger and make the correct journal for Stationery and
the right amount of £2.00 for Postage. “
1. Reversal journal: opposite entry to the
original.
Transaction
Date
Reference Nominal code Debit (£) Credit (£)
01/07/2020 Private Use & Exps 5000 – furniture sales 40.00
01/07/2020 Private Use & Exps 2200 – VAT 8.00
01/07/2020 Private Use & Exps 3050 - Drawings 48.00
Transaction
Date
Reference Nominal code Debit (£) Credit (£)
01/07/2020 Private Use & Exps 5000 – furniture sales 40.00
01/07/2020 Private Use & Exps 2200 – VAT 8.00
01/07/2020 Private Use & Exps 3050 - Drawings 48.00
Original
Reversal Journal
19. Practice: journal (Self-Test Activity Thirty, Unit 3,
Sage)
“You are asked to Reverse the first entry using the Reversals option in
the Nominal Ledger and make the correct journal for Stationery and
the right amount of £2.00 for Postage. “
Transaction
Date
Reference Nominal code Debit (£) Credit (£)
01/07/2020 Private Use & Exps 5000 – furniture sales 40.00
01/07/2020 Private Use & Exps 2200 – VAT 8.00
01/07/2020 Private Use & Exps 3050 - Drawings 48.00
Reversal Journal
Transaction
Date
Reference Nominal code Debit (£) Credit (£)
01/07/2020 Private Use & Exps 5100 – Stationery sales 40.00
01/07/2020 Private Use & Exps 2200 – VAT 8.00
01/07/2020 Private Use & Exps 3050 - Drawings 48.00
Correction Journal
20. Practice: journal (Self-Test Activity Thirty, Unit 3,
Sage)
“You are asked to Reverse the first entry using the Reversals option in
the Nominal Ledger and make the correct journal for Stationery and
the right amount of £2.00 for Postage. “
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
Private Use &
Exps
7501 – stamps 5.00
01/07/202
0
Private Use &
Exps
3050 - Drawings 5.00
Original
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
Private Use &
Exps
7501 – stamps
01/07/202
0
Private Use &
Exps
3050 - Drawings
Correction journal
21. Practice: journal (Self-Test Activity Thirty, Unit 3,
Sage)
“You are asked to Reverse the first entry using the Reversals option in
the Nominal Ledger and make the correct journal for Stationery and
the right amount of £2.00 for Postage. “
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
Private Use &
Exps
7501 – stamps 5.00
01/07/202
0
Private Use &
Exps
3050 - Drawings 5.00
Original
Transacti
on Date
Reference Nominal code Debit (£) Credit (£)
01/07/202
0
Private Use &
Exps
7501 – stamps 3.00
01/07/202
0
Private Use &
Exps
3050 - Drawings 3.00
Correction journal
24. This is a screenshot of
Sage Account’s nominal
codes.
All the transactions
entered into the
software has to be
coded to a nominal
code.
All the nominal codes
are finally assimilated
into the chart of
accounts, which is the
basis for financial
accounts preparation.
25. All the nominal code
descriptions can be
changed in Sage
software.
Descriptions should be
tailored to meet the
company’s reporting
need.
27. 1. Amend
nominal codes so
it best describes
the nature of
business
transactions.
2. All the nominal
code balances that
then summarised
into main headings
based on the
defined code range.
3. The balances are
then reported in
Statement of Profit
& Loss or
Statement of
Financial Position
(Balance Sheet).
28. Types of data processing
C_ _ _ _ _ R _ a _
Up_ _ _ _ D_ l _ t _
LO4
Create Read
Update Delete
Processing and Distribution
29. Methods of data processing
Batch processing: acc_ _ _ _ _ t_ _
_ transaction records into groups or
batches for processing at a r_ g _ _ _
r interval. (To process at night or
when you get sufficient amount)
Real-time processing: data is
processed _ _ _ _ _ _ _ _ _ _ _
after capture and updated
information to users on a _ _ _ _ _
_ basis. Eg Internet Banking
LO4
accumulating
regular
immediately
timely
Processing and Distribution
30. Information
Output
Type of information provided by AIS
LO2
Report
System output, organised in a meaningful
way, that is used by:
• Employees to control operational
activities,
• Managers to made decisions,
• Investors and creditors to understand
business’ activities.
• Etc
31. Systems documentation
techniques
LO5
Narratives, flowcharts,
diagrams, and other written
materials that explain how a
system works.
1. Data flow diagram: a graphical description of data s_ _ _ _ _ _, data
flows, transformation p_ _ce_ _ _ _, data s_ _r _ g _, and data _est_n_t_ _
_s.
2. Flowchart: a graphical description of a s _ s _ e _.
3. Business process diagram: a graphical description of the business
_ _ _ _ _ _ _ _ _used by a company
sources
processes storage destination
s
system
processes
32. Data Flow Diagram (DFD) – basic
elements
LO5
The people and organisation that send data to and
receive data from the system.
The flow of data into or out of a process.
The processes that transform data from inputs to outputs.
Data flow diagrams are subdivided into successively lower levels to
provide ever-increasing amounts of detail.
33. Data flow diagram - practice
Fabrik Clothing Ltd works with local
talented designers. All items are
sources and produced in the UK.
Use DFDs to explain the expenditure
processing procedure when Fabrik
Clothing Ltd pays a supplier.
LO5
34. Data flow diagram - practice
LO5
Supplier
Bank
Payment to
supplier
Remittance data
Payment
information
Payables
Officer
Process
payment
Update supplier
account
Paymen
t
36. Flowcharts– basic elements
LO5
Start/end point
Connector that shows relationships
between the representative shapes
Input/output
Process
Decision
Data stored electronically in a
database
37. Flowcharts – practice
LO5
Use flowcharts to explain the flow of
document and data when a sale is
made on credit.
38. Flowcharts – practice
LO5
Sales
amount
Product list
Customer
name,
address
Input sales data Customer
database
Inventory database
General ledger
Print sales invoice
Update database
Sales database
Practice: which flowchart key should
represent each of the 3 dataset
above? (2 mins)
39. Flowcharts – practice
LO5
Start Input
sales
data
Print
sales
invoice
Update
database
Customer
database
Inventory
database
General
ledger
Sales
database
Sales
invoice
Practice: complete the flowchart (5
mins)
40. Business process diagram – basic
elements
LO5
The start or beginning of a process.
The end of a process.
An activity in a process.
The flow of data or information.
Practice: prepare a business process diagram to document the
expenditure process.
41. Business process diagram – basic
elements
LO5
Accounts department
Receives
supplier
invoice
Records
invoice details
Prepares
payment
authorisation
form
Director
Approves
payment to
supplier
Makes
payment
Update
ledgers
42. Sage learning:
overview of the
course contents
70% of overall
assessment
weighting for
ACC1135
module
(20% online
submissions and
50% in-class
test)
43. All learning materials can be accessed
via: portal.sagequalifications.com
Learning materials:
4 learning units
44. Sage: Introduction unit
overview
Software installation,
guide to how to use Sage
learning materials
Setting up a company’s
profile on Sage software
Data storage: ledgers and
chart of accounts
45. Sage: Unit 1 overview
Revenue cycle:
data input
Revenue cycle: data
processing (batch
processing)
Revenue cycle: data
output(document and report)
Revenue cycle and
expenditure cycle: data input
Revenue cycle: data
input
Expenditure cycle: data
processing (batch
processing)
Expenditure cycle: data
output(document and report)
Data output
46. Cash management: cash
inflow, cash outflow, control
Check data stored in
the system with
source document.
Sage: Unit 2 overview
Scenario (chapter 2, core textbook):
Susan and Scott are working long hours for the grand opening of S&S, an estate agency based in London, specialised in student lettings.
Susan and Scott have not given much thoughts into their accounting records as they are busy dealing with other parts of the business.
Susan and Scott already has a stack of property enquiry forms completed by local students looking for properties to let.
They has been few landlords contacted Susan and Scott expressing their interest of letting out their property.
Three full time staff are hired and about to start working from the day of opening, they needs to be registered on the payroll system.
Susan and Scott invested £15,000 cash into the business, the fund is saved in Barclays Current Account. They are planning to use some of this capital to purchase office furniture and equipment.
Susan spoke to Tom, a friend that works in an accounting firm. Tom suggested Susan to use Sage software, as it is a popular and user friendly software used by many small companies to process and prepare accounting records.
How should the accounting records be organised so the financial statements can be easily produced?
How should data about S&S’s transactions be collected and processed?
How should data be organised?
How should the accounting information system be designed so that it is reliable and accurate?
How can procedures be designed to ensure all government obligations are met (such as: payment for payroll taxes and VAT).
It is important to note that this model is generic; the way in which models like this are implemented in reality will vary quite significantly depending on many factors, including the nature of the data, its quantity, and the way it is used (lecture 1: compulsory? Cost and benefit approach).
Areas of the data lifecycle that typically should be of particular interest to accountants and finance professionals are shaded in red; note, however, that for those who will get involved in implementation of data governance, all areas should eventually become equally relevant.
Historically, responsibility for the data at various stages of the lifecycle was entrusted to IT and/or Operations departments and, when data tasks became more complex, business analysts and/or data architects would have to get involved. More recently, however, there has been a growing demand for more direct involvement in data-related activities from users across the business. Note, for instance, the ‘Analysis and Discovery’ area, where the ‘Discovery’ part highlights a rapidly developing trend for giving end users direct access to large complex data sets via new powerful business intelligence and visualisation tools. Such tools also allow dynamic user-driven reporting, and this will be of particular interest to accountants, in particular with the expected uptake of integrated reporting.
Traditional pre-defined reports and data extracts, listed in the model as part of the ‘Processing and Distribution’ stage of the data lifecycle, will no doubt retain their importance. ‘Storage and Security’ and ‘Archiving and Disposal’ stages are highlighted in the model because of the increasing importance of regulatory compliance in matters such as data retention and data disposal.
Accountants have to play an increasing role in these areas, especially because data-related legislation is still far from being firmly established in any given country, besides which, huge discrepancies in the implementation of such legislation and its enforcement exist all across the world.
Reshuffle and correct. Cancel the entries.
Each of your ac has a specific code. Bring to PL ac. Low-High means the range. No of products I want. The more segregated the better for decision making.