COST AND INCOME ACCOUNTING

 1. Definition of expenses - they represent a decrease in economic benefits during the
reporting period in the form of a decrease (leakage) of assets or an increase in liabilities,
which results in a decrease in equity, without prejudice to distributions between owners.
Expenses are accounted for on an accrual basis but are not assets.

2. Definition of revenue - revenue represents the gross flows of economic benefits

during the period created in the ordinary course of business of the enterprise,
manifesting itself as an increase in assets or a decrease in liabilities resulting in an
increase in equity, regardless of distributions between owners.

3. Basic accounting principles in accounting for expenses and revenues:

a) current reduction - income and expenses are accounted for. E.g. accrued wages, we
recognize them as expenses, regardless of whether we paid them. Budget exclusion
(b) the comparability of revenue and expenditure

4. Cost accounting
The expenses for the activity of the enterprise are reported in two aspects - by economic
activity (gr. 60) and by functional purpose (gr. 61 - Activity expenses).
The financial expenses are accounted for in the accounts of UAH 62 - accrued expenses
for interest, fees, commissions, foreign exchange transactions with securities and more.
Expenses that do not relate to the current period - subscriptions paid in advance,
insurance, are recorded as Expenses for future periods. These expenses do not
contribute to the formation of the financial result for the current year and are stated as
an item in the balance sheet.
All other expenses must be completed at the end of the reporting period, credited
against debiting the Profit and Loss account for the current year.

5. Revenue reporting
In the accounts from g.70 - Sales Revenues
72 - Financial expenses
At the end of the reporting period, they are closed by debiting against crediting the
Profit and Loss account. Not only are the revenue for the future periods not included in
the formation of the financial result, but remains as a separate financial position.
Upon the completion of revenue and expenses, which is a stage of the annual
accounting closure, a financial result from the activity of the enterprise is formed. To do
this, use the Profit and Loss account for the current year (1230). Costs (no future
periods) are transferred to their debit and revenue (no future periods) to the loan. The
debit balance shows an accounting loss and the credit balance shows an accounting
profit.
The financial result thus formed is converted out of the accounting into the CITA and an
annual loss or taxable profit is obtained. Then the corporate tax is calculated (Profit and
Loss from the current year and the Account for Corporate Tax Calculations - gr.45) and
the net (balance) profit remains.
 THE GENERAL THEORY OF ACCOUNTING
1. Objects of accounting
The assets of the enterprise as an object of accounting. Regulations
of accounting. Content, composition, and structure of assets and capital of
the enterprise. Contingent assets and liabilities. Business operations and processes.
2. Balance sheet summary
Nature and form of the balance sheet summary. Content, composition, and structure of
the balance sheet. Balance Sheets. Types of balance sheets. Impact of
business operations on the content and structure of the balance sheet.
3. System of accounting and accounting chart
The nature and importance of accounting. Content, structure, and forms of
accounting records. Classification of accounts. Accounting
chart of accounts - content and principles of construction.
4. Double-entry accounting
The essence and logical foundations of double entry. Correspondence of
accounting and accounting items.
5. Documentation of business operations and inventory
The nature and importance of documentation and inventory. Shaped,
movement and storage of documents. Primary Accounting Album
documents. Types of inventory. Inventory order.
Documentation and reporting of results.
6. Current and periodic accounting
The essence and functions of current accounting. Chronologically and
systematic accounting - nature and types, turnover sheets for
the situation on synthetic and analytical accounts, accounting errors and
ways to correct them.
Company Accounting
7. Equity reporting
Equity characteristics - Fixed capital and capital reserves.
Reporting of fixed capital and capital reserves - accounting documents
accounts, business transactions and accounting records.
8. Accounting for loans received
Characteristics of attracted capital - long-term and short-term loans,
commercial loan, leasing, bond loan. Reporting of attracted capital -
documents, accounts, business transactions and accounting records.
9. Formation and reporting of the financial result
Characteristics of the financial result - profits and losses from the current year,
retained earnings from previous years, uncovered loss from previous years,
accounting and tax financial result, balance sheet profit and loss. Reporting
the financial result - documents, accounts, business transactions and
accounting records.
10. Reporting the acquisition and repair of tangible fixed assets
Characteristics of tangible fixed assets, types, valuation, recognition
according to the accounting standard. Accounting for the acquisition and repair of
fixed tangible assets - documents, accounting, business
operations and accounting records.
11. Reporting the reduction and elimination of fixed assets
assets
Characteristics of tangible fixed assets, types, valuation, recognition
according to the accounting standard. Reporting of the reduction and liquidation of
fixed tangible assets - documents, accounting, business
operations and accounting records.
12. Taking into account the increase and decrease of fixed assets
Characteristics of fixed assets, types, valuation,
recognition. Accounting standard. Accounting for the acquisition and reduction of
non-current intangible assets - documents, accounts, business
operations and accounting records.
13. Accounting for the depreciation of non-current assets
The essence of the depreciation of fixed assets. Depreciation methods.
Accounting standards for amortization of fixed assets. Reporting
depreciation of fixed assets - documents, accounts, business
operations and accounting records.
14. Reporting the increase and decrease in long-term financial assets
Characteristics of the increase and decrease of long-term financial
assets, types, valuation, recognition. Long Term Lending from
the banks. Accounting standards for accounting for the increase and
the decrease in long-term financial assets - documents, accounts,
business operations and accounting records.
15. Reporting the increase in inventories. Evaluation of
inventories in their acquisition
Characteristics of inventories, types, recognition, valuation.
Accounting standard. Valuation of inventories at their
acquisition. Reporting Increases in Inventory -
documents, accounts, business transactions and accounting records.
16. Reporting of reductions in inventories. Assessment methods
of inventories at their decrease
Characteristics of inventories, types, recognition, valuation.
Accounting standard. Methods for inventory reductions.
Reporting reductions in inventories accounting documents
accounts, business transactions and accounting records.
17. Reporting on accounts with suppliers and customers
Characteristics of accounts with suppliers and customers - occurrence and closure.
Reporting on accounts with suppliers and customers - documents, accounts,
business operations and accounting records.
18. Accounting for staff estimates
Characteristics of staff estimates - origination and closure. Reporting
staff estimates - documents, accounts, business operations and
accounting records.
19. Reporting of settlements with partners, accountants, other debtors and
lenders
Characteristics of settlements with partners, accountants, other debtors and
creditors - origination and closure. Affiliate Reporting,
Accountants, Other Debtors and Creditors - Documents, Accounts,
business operations and accounting records.
20. Reporting on estimates of absences and records, litigation and sentencing
receivables
Characteristics of defaults and records, litigation and sentencing
receivables - arising and closing. Reporting of missing and reported estimates,
litigation and receivables - documents, accounts, business
operations and accounting records.
21. Reporting of calculations under the Corporate Income Tax Act
(CITA), the Local Taxes and Fees Act (CITA) and the Tax Act
on the Income of Individuals (CITA)
Characteristics of the normative documents for taxation under the CITA, LMST and
TITL. Reporting of the calculations under CITA, ZMDT and ZDDFL - accounting documents
accounts, business transactions and accounting records.
22. Reporting of calculations under the Value Added Tax Act (VAT Act) and
The Excise Duty Act
Characteristics of the normative documents for taxation under the VAT Act and the Law on Taxation
excise duties. Reporting of the VAT and the Excise Duty Act calculations - documents,
accounting, business operations and accounting records.
23. Accounting for cash in BGN
Characteristics of cash in BGN. Cash reporting in BGN -
documents, accounts, business transactions and accounting records.
24. Currency reporting
Currency characteristics. Cash reporting in
currency - documents, accounts, business transactions and accounting records.
25. Accounting for short-term loans and short-term loans
financial investments
Characteristics of short-term loans and short-term financial loans
investments in the enterprise. Reporting of short - term loans granted and
short-term financial investments - documents, accounting, business
operations and accounting records.
26. Accounting for costs by economic elements and costs of operation
Characteristics of cost by economic elements and costs of operation in
the enterprise. Kinds. Separation of costs for current and future periods.
Cost calculation. Cost accounting by economic elements and
business expenses - documents, accounting, business operations and
accounting records.
27. Accounting for financial and extraordinary expenses and expenses for the future
reporting periods
Characteristics of financial and extraordinary expenses and expenses for future
reporting periods. Accounting for financial and extraordinary expenses - documents,
accounting, business operations and accounting records.
28. Accounting for operating income
Characteristics of operating income. Types of revenue. Reporting
operating income - documents, accounting records, business transactions and
accounting records.
29. Accounting for financial and extraordinary income and revenue for the future
reporting periods
Characteristics of financial and extraordinary income and revenue for the future
reporting periods in the enterprise. Financial and extraordinary reporting
revenue - documents, accounting, business operations and accounting
recordings
30. Annual financial statement
Essence and stages of annual accounting closure. Accounting standard for
the presentation of annual financial statements. Content and general requirements for
annual financial statements, reporting forms.