ACCOUNTING;
IS 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 A FINANCIAL CHARACTER
AND INTERPRETING THE RESULTS.
RECORDING
CLASSIFYING
SUMMARIZING
TRANSACTIONS
BUSINESS ENTITY
IN TERMS OF MONEY
FINANCIAL STATEMENTS
BALANCE SHEET
INCOME STATEMENT
CASH FLOW STATEMENT
USERS OF ACCOUNTING INFORMATION:
MANAGERS
AUDITORS
OWNERS/PARTNERS/SHAREHOLDERS
POTENTIAL INVESTORS
TAX OFFICE
LABOUR UNIONS
SOCIAL SECURITY INSTITUTION
BANKS
CREDITORS
DEBTORS
CAPITAL MARKET INSTITUTION
PARTICIPATIONS
THE PUBLIC GENERAL
Tuba Dumlu
1
1ST PERSON →
BUSINESS ENTITY ITSELF
2ND PERSON →
OWNERS/ PARTNERS/ SHAREHOLDERS
3RD PERSON →
REST
TYPES OF BUSINESS ORGANIZATIONS:
1. INDIVIDUAL (SOLE) PROPRIETORSHIP (ŞAHIS ŞİRKETİ)
2. PARTNERSHIPS (ORTAKLIKLAR)
→
JOINT VENTURE (ADİ ORTAKLIK)
→
GENERAL PARTNERSHIP (KOLLEKTİF ŞT.)
→
LIMITED PARTNERSHIP (KOMANDİT ŞT.)
→
LIMITED COMPANY (LİMİTED ŞT.)
3. CORPORATION (A.Ş.)
TRANSACTION:
IS A SPECIAL KIND OF EXTERNAL EVENT IN WHICH THE ENTITY
EXCHANGES SOMETHING OF VALUE WITH AN OUTSIDER.
EXTERNAL EVENTS WHICH ARE INTRODUCED TO ACCOUNTING SYSTEM
ARE CALLED AS “BUSINESS TRANSACTIONS”. TRANSACTIONS ARE THE
INPUTS OF ACCOUNTING SYSTEM, OUTPUT WILL BE FINANCIAL
STATEMENTS.
Tuba Dumlu
2
BALANCE SHEET:
→
SHOWS THE FINANCIAL POSITION OF A COMPANY FOR A
SPECIFIC POINT OF TIME,
→
SHOWS THE ASSETS AND THE SOURCES OF THE ASSETS
(LIABILITIES) OF A COMPANY.
BALANCE SHEET CONTAINS:
NAME OF THE STATEMENT
NAME OF THE BUSINESS ENTITY
DATE
ASSETS
LIABILITIES
OWNERS’ EQUITY
ASSETS:
→
ARE RESOURCES OWNED BY A COMPANY,
→
THEY ARE THINGS OF VALUE USED IN CARRYING OUT
SUCH ACTIVITIES AS PRODUCTION, CONSUMPTION, AND
EXCHANGE.
CURRENT ASSETS:
ARE CASH AND OTHER RESOURCES THAT ARE REASONABLY
EXPECTED TO BE REALIZED IN CASH OR SOLD OR CONSUMED IN
THE BUSINESS WITHIN ONE YEAR OF THE BALANCE SHEET DATE
OR THE COMPANY’S OPERATING CYCLE, WHICHEVER IS LONGER.
FIXED ASSETS:
ASSETS OF A RELATIVELY PERMANENT NATURE THAT ARE
BEING USED IN THE BUSINESS AND NOT INTENDED FOR RESALE
Tuba Dumlu
3
LIABILITIES:
→
ARE CLAIMS AGAINST ASSETS,
→
ARE EXISTING DEBTS AND OBLIGATIONS.
CURRENT LIABILITIES:
ARE OBLIGATIONS THAT ARE REASONABLY EXPECTED TO BE
PAID FROM EXISTING CURRENT ASSETS OR THROUGH THE
CREATION OF OTHER CURRENT LIABILITIES.
LONG-TERM LIABILITIES:
OBLIGATIONS EXPECTED TO BE PAID AFTER ONE YEAR
OWNERS’ EQUITY:
→
INVESTMENT OF CAPITAL IN THE BUSINESS BY THE INVESTOR
→
INCOME RETAINED FOR USE IN THE BUSINESS.
Tuba Dumlu
4
BALANCE SHEET OF XYZ CO. AS OF 31.12.2018
I. CURRENT ASSETS
Cash & Banks
Marketable Securities
Trade Receivables
Inventory
Prepaid Expense
Revenue Accruals
I. CURRENT LIABILITIES
Bank Loans
Trade Payables
Unearned Revenue
Expense Accruals
II. LONG-TERM LIABILITIES
Bank Loans
Bonds Payable
Trade Payables
II. FIXED ASSETS
Trade Receivables
Financial Fixed Assets
Tangible Fixed Assets
Intangible Fixed Assets
Tuba Dumlu
III. OWNERS’ EQUITY
Capital
Net Income (or Loss)
5
INCOME STATEMENT:
PRESENTS THE REVENUES AND EXPENSES AND RESULTING NET
INCOME OR NET LOSS OF A COMPANY FOR A SPECIFIC PERIOD OF TIME.
THE PRIMARY FOCUS OF THE INCOME STATEMENT IS ON REPORTING
THE SUCCESS OR PROFITABILITY OF THE COMPANY’S OPE-RATIONS
OVER A SPECIFIED PERIOD OF TIME.
EXPENSE:
THE COST OF ASSETS CONSUMED OR SERVICES USED IN THE PROCESS
OF EARNING REVENUE.
EXPENSES ARE THE OUTFLOW OF ASSETS IN ORDER TO GENERATE
REVENUES.
EXPENSES ARE THE EXPIRED COSTS.
REVENUE:
THE GROSS INCREASE IN OWNERS’ EQUITY RESULTING FROM BUSINESS
ACTIVITIES ENTERED INTO FOR THE PURPOSE OF EARNING INCOME.
REVENUES ARE THE INFLOW OF ASSETS.
INCOME STATEMENT SHOULD CONTAIN:
NAME OF THE STATEMENT
NAME OF THE BUSINESS ENTITY
PERIOD
REVENUES
EXPENSES
NET INCOME (OR LOSS)
Tuba Dumlu
7
INCOME SUMMARY OF XYZ CO. FOR THE PERIOD OF
01.01.2018-31.12.2018
COGS
Rent
Wages
Advertising
Interest
Commissions
Depreciation
Communication
Transportation
R&D
Insurance
Repairs & Maintenance
Stationery
Heating
Tuba Dumlu
Sales
Rent
Interest
Commissions
Dividends
8
INCOME STATEMENT OF XYZ CO.
FOR THE PERIOD OF
01.01.2018-31.12.2018
SALES………….………..XXXXX
COST of GOODS SOLD....(XXXX)
GROSS PROFIT..…………XXXX
OPERATING EXP.:
Selling Exp……………. XX
General Adm. Exp….… XX
(XXX)
OPERATING INCOME....….XXX
NONOPERATING REV…..….XX
NONOPERATING EXP…...…(XX)
FINANCIAL EXPENSES:
Interest……………….XX……....(XX)
NET INCOME……..........….… XX
TAX…………………………….(X)
NET INC. AFTER TAX…….....XX
Tuba Dumlu
9