10th

advertisement
Chapter 3 10th ed. Accrual Accounting
Financial Accounting
1 7 9 14
19 20 22 39
66 67 17
Transaction
What did you receive?
What did you give up?
What did you receive?
Why did you receive it?
Why did you give it up?
What did you give up?
Revenue, Expense, Asset, Liability, Owners’ Equity
Income State, State of Ret Earnings, Balance Sheet
What kind of Account is it?
What statement does it live on?
Income Statement
Statement of Retained Earnings
Balance Sheet
For the year ended Dec. 31, 2014
For the year ended Dec. 31, 2014
As of Dec. 31, 2014
Revenues
Expenses
Net Income
Retained Earnings at Jan. 1 2014
plus Net Income
less Dividends (paid)
Retained Earnings at Dec. 31, 2014
Assets
Liabilities
Owners’ Equity
Assets
= Liab +Own Eq
Use Problem 2-34/ 3-39 as review and bridge
Use Spreadsheet of Chapter 2’s mid-chapter summary as a review and as a bridge
page 2
p. 144
The GAP Starbucks
Revenue
Net Income
14,549
833
13,299
1,384
Which would you rather own? The GAP or Starbucks stock
Accrual Accounting implies GAAP
GAAP are the principles, rules, standards we follow to prepare accrual based financial statements
Fiscal year – vocabulary word
p. 116 Revenue Principle
S3-7 Matching Principle
S3-9
recognize revenue when Earned and Realizable
try to recognize expenses in the period they help generate Revenue
match prepaid rent to period the rent benefits
the ethical example
S3-1
S3-20 Adjusting Entries
Deferral receive cash
pay cash
defer
defer
recognizing the revenue
recognizing the expense
Unearned Revenue
Prepaid Expenses
Depreciation is a special case of a Prepaid Expense / Deferral
Accrual
recognize the revenue
recognize the expense
before
before
receiving the cash
paying the cash
Account receivable
Account payable
Record Journal Entries in General Journal
post JE to General Legder
prepare Trial Balance
Record Adjusting Jnl Entries in Gen. Jnl.
post JE to General Legder
prepare adjusted TB
Prepare Financial Statements from Adjusted Trial Balance
Record Closing Jnl Entries in Gen. Jnl.
P3-66
Pr 3-67
post JE to General Legder
work as major example on the Board
P. 144 Exh 3-15
p. 144 Exh 3-14
Multi-Step Income Statement
Classified Balance Sheet
See versions on Spreadsheet
3-17
Current Ratio also calculate ratios for P 3-67 & Starbuck’s financial state Exhibit 3-14 p. 143
Debt Ratio
Download