@ Income or Revenue: 13 olslyVl Revenue is an increase in the economic benefits ( increase in Equity) during the accounting period in the form of: Bob ys boll ul, 035 ol S955 ™ Inflow of assets us.o\ll ool ™ Decrease of liability olel JVI go alas Example: ™ Revenue from goods sales or service fees aul sly! ™ Sales revenue acladl ay uo ail aly ™ Services Fees received(earned) leas! puis aly! "Interest revenue Bilogll ailg9 aly1 ™ Dividends revenue ollosLwWl ely! oleis5 aly! ™ Royalties received ALSgall alu! ™ Rent received skal all @ Expenses: oligo] Is a decrease in the economic benefits (decrease in equity) during the accounting period in the form of: - out flow of assets or - incurred liability Example: Cost of goods Sold Salaries expense Interest expense Tax expense Utilities expense Marketing expense Advertising expense Rent expense Repair and maintenance expense Telephone expense Depreciation expense Spb oe loll pul) 09 yas ios soll Jala wloljV ols acloll aclaul aalss lizell B90 4928 A199 S920 Ulall Gs20 glial! bg,00 Gigs] Ol89.20 ayleall Bs,20 sbeVI g,20 @lall bs20 oligéalall Bg 00 MAY! Bp,.0014 Lae ple Jie Depreciation expense: sl] UgoVl bij ,0 SMAI 49.00 Related to PP&E ( Property, Plant & Equipment) Example: Land $100,000 Building $200,000 with Useful life 40 years Required: Compute depreciation expense ? Solution boy No Depreciation for Land “Wg ¥ 221% o!15 ® Accounting equation ~ desl dalett Assets = Liabilities + Owners’ equity CLA | OMe | Sit ge Properities | | ebligahons | Capital - | + Cosh | + loans 1 eee doh abe : a abi + Wages elnvestment — “LLazal + Buildin Cos Equipe i Fawsble i oon {sles Slael - Furnituye + office Supplies | + Tex aysble 1 Lee MU sky « Accounts Recerable| + Accounts Sopble | 2 Withdvawals Chane 1 ie Expenses — Ghlee + Notes Fable | ‘ oi J 0 hi 455 eS plang + Notes Receivable16 Nature of Financial Accounting: (1) Financial Accounting as a profession: aigsS auwlxall A profession is a known career that requires an identified path for the acquisition of specialized and/or formal education or training before rendering any service. apall oss Si prsdi Led rou, gl / 9 Yaario Gus) gl puled GLuiSY Siro IjLino Lullaid Adg.n0 Aigo nd CPA's The primary accounting professional association in the U.S. is the American Institute of Certified Public Accountants (AICPA). Owl Gawlea GS ol speoll nb d.rcall OLVell ad Gavsilill gawleal) Qripall Al ouaizall The AICPA prepares the uniform CPA Examination, which must be completed in order to become a Certified Public Accountant Vnsee Uigild Cowles duct i> alles] Loy Silly « CPA Ubxial slack AICPA sai (2) Financial Accounting as a Lanquage: OS dl a) 90 arwbeoll * Language is a means of communication. ols awe xo aalll * Accounting is a Language because is a means of communicating business information Spill leglae Juco aus iV aid xo auwleoll « Financial accounting is usually referred to as the lanquage of business (3) Financial Accounting as an information system: Slogleal) pli 9 auuleall The acquisition of Key business information that includes income, expenditure, profit , assets and liabilities are made available from financial statement prepared by accounts. obLusll yo laslicl ax cull ellall pilgall o8 loylpbl ax aolpll yusoleoll ologlaall17 Usefulness of financial reporting: raJlol lau! oils - The objective of general financial reporting is to provide financial information about the entity that is useful to existing and potential investors, lenders and other creditors in making decision relating to providing resources to entity. calacrally culled! pyaiianall Sade U9 Spill ge Alle Oleglao 5897 90 plall callall »pAill uo Sagi 6 Spal) sygoJl pSgi Sleioll sal! Sei! 98 ww FV Gaiilulg unopHolly - Those decisions involve decisions about: (a) Buying, selling or holding equity and debt instruments gall ale Ug.acll gl Sloll uly blax>VI (b) Providing or settling loan and other forms of credit 6550 UlasiVI USuily U9, All Agus of pv sai (c) Exercising rights to vote on, or influence, management's actions that affect the use of the entity's economic resources. sOLSU @ysLasSUl sulgoll plascal ole 235) sll 8,bYl olel>| ale cll 9] cussaill Spa> Ausjloo