PAGE 1

Single entry
Formulas:

1. Computation of net income using Single Entry Method

A. For Single Proprietorship and Partnership

Increase/Decrease in Net Assets:

Capital balance, end Pxx
Capital balance, beginning (xx) Pxx

Withdrawals xx
Additional Investments / Contributions ( xx)
Net Income Pxx

B. For Corporation

Increase/Decrease in Retained earnings:

Retained earnings, end Pxx
Retained earnings, beginning (xx) Pxx

Dividends declared xx
Net Income Pxx

2. Computation of Net Income by Analyzing

Changes in Account Balances

A. For Single Proprietorship and Partnership

Dr(Cr)
Increase in Assets Pxx
Decrease in Assets (xx)
Increase in Liabilities (xx)
Decrease in Liabilities xx
Increase in Net Assets xx
Withdrawals xx
Additional Investments/Contributions (xx)
Net Income Pxx

B. For Corporation

Dr(Cr)
Increase in Assets Pxx
Decrease in Assets (xx)
Increase in Liabilities (xx)
Decrease in Liabilities xx
Increase in Stockholders Equity xx
Increase in Contributed Capital (xx)
Decrease in Contributed Capital xx
Increase in Retained Earnings xx
Add: Dividends declared xx
Net Income Pxx

SE
 PAGE 2

Cash vs. Accrual

Formulas:

Cash Basis Accrual Basis

1. Total Sales

Cash Sales xx xx
Add: Sales on account:
AR and NR, end xx
Collections of AR /NR xx xx
NR Discounted xx
Write off xx
Sales returns and allowances xx
Sales discounts xx
AR and NR, beginning . . (xx)
Total Sales xx xx

Cash Basis Accrual Basis

2. Total Purchases

Cash Purchases xx xx
Add: Purchases on account:
AP and NP, end xx
Payments on AP/NP xx xx
Purchase returns and allowances xx
Purchase discounts
AP and NP, beginning . . (xx)
Total Purchases xx xx

Cash Basis Accrual Basis

3. Expenses in General

Expenses Paid xx xx
Add/(Deduct):
Prepaid expenses, beginning xx
Accrued expenses, end xx
Prepaid expenses, end (xx)
Accrued expenses, beginning . . (xx)
Total Expenses Incurred xx xx

Cash Basis Accrual Basis

4. Other Income

Income (cash) received xx xx

Add/(Deduct):
Unearned income, beginning xx
Accrued income, end xx
Unearned income, end (xx)
Accrued income, beginning . . (xx)
Total Income Earned xx xx

5. Depreciation (applicable to cash and accrual basis)

PPE beg xx
Add: Acquisition / Purchase of PPE xx
Total xx
Less: PPE end xx
Sale or Disposal of PPE xx xx
Depreciation expense xx

SE
 PAGE 3
--END--

SE