18

participation 0987519268
20
quizzes (4th& 10th class) RhuglinhCt & unn. edu. un
28 midterm (7th)
B final (12)

Business-for-profit
I
non-profit
POA 1

8·Merchandising
-Service business

business

Manufacturing business

Internat users - External users

Investors
Owners Government / tax authority
Managers Financial institutions

Employees Suppliers
Customers
↓
N
Managerial
I
accounting
Financial accounting
prediction
POA 2 I ->
pastfinancial performance

POA 1

fan bad co chick

nd:gian tai
 The conceptual framework

( Ca'the doanh)
kink

Gli chi phi san and chi daanh fier dan drank
una
ughiep voo di and
ughie
-> giain the

Corporation business:
Long by cophan

O
accounting
5 elements

san)
1-
1. assets (tai
c. Liabilities (no) financial position
E voicsh)
3. equity
I the chap) financial performance
1
4. income ->

5. expenses 2 Chi phil

I (
Exp 0 Loss
-

=>

7 0 =
Profit
Von the col (equity)
el
von
!
-
nhadan this
equity)
von-vay (liabilities)
long long than (liabilities)
93
no view

maymo

I
thue

I
nW

phong
the mishang plan
tien
2

assets
-
expenses
uha may
- /

hang Loa
!
giay phep ad I
 Assets astrolled
-
presenteconomicresources
I

i Current asset:held used

and for
only a short time 712 months

↳ Non-currentasset: for only a

long time - 12 months

·
Land & buildings
·
Motor vehicles
Plant& machinery
·

Equipment
·
Cash

contestors):
Debtors

·mentory
/
ccount receivable
amounts
the entity
owed
by customers & in
others

(Phaithu)
1 customers

Liability-
- presentobligation

is current liability
+) non-current
liability
chi
than
·

a bank loan /overdraft

Creditors/payables (or
creditors)/ phaitral my
ban

L
accounts payable"
suppliers for goods

·
owed to
taxation government
the
 Owners' equity owner's contributions
-
- retained earning

/
withdrawals: & goods taken out of business by its
money
is a

owner -> rut von

drawingS

Assets Liabilities
=
Owner's
+

equity

or

Assets Liabilities Owner's Revenue

equity Expenses
+
-
+
=

wis
equity Capital -
Income
- -

Expenses
-
- sales
earned
Fees revenue

Lung cap dich ru) I

cang sap' hang hoal

asset
Liability owner's equity
account receivable account payable fees earned
cash wages expense
land my
expense
supplies/office supplies
motor ve hicles
 buy on account:mna chil
sell account:ban chin
Business transactions
-
on

economics events/condition that

directly changes an

financial position results

entity's or its
operations
of

Eating
equation

Assets Liabilities owner's

- t
equity

⑰ +
25000
I
+
25,000
(cash ( (Clark, Capital)

⑬ +

20,000
(Land)
- 20,000
Cash)

⑳ +
1,350 1,350
+

(supplies) (accounts payable)

⑪ +

7,508 +
7,508
(cash) (Fees earned (
/ income

&

I
-

3,650 (cash) + 2,125

Iwages expense)
800
-

I went expense)
+
450
cutilities expense)
275
+

(miscellaneous expense)
 Assets Liabilities Owner's
t
equity
-

1000 (cash) 1,538 (account payable)

+
+

+
3,200 payable)
(accounts
850
+

(supplies)
10,000
+
(land)

I
0-1500 (cash) Iwage
expl
t 85
+ 325 (utilities
exp
-

+250
(answering service expl
75
+
(miscellaneous expl

8
115 (supplies)
(+ 115 (supplies
used)
-

cost S
presenteconomic resource controlled
future economic benefits 7 Fees earned
Assets
- sales revenue

I
-

Current asset (12 months I I come

~
712 months
↳
Non-current asset

increases in assets
decreases in liabilities

5
presentobligation Liability Accounting Elements
-
-

liability I
I
current

Expenses decreases
non-current
liability E
in assets

increases in liabilities

Owner's
equity
owner's contributions
~ ↓
retained earning

Income
Expenses
-

-
 Assets - Liabilities -
Owner's
Equity R1A
@ +
30,000 (cash)
+

30,000 (Eisen, capital)

6 1,200
+

(supplies) +
1,200 (accounts payable)

6 +
7,200 (cash) +

7,200 (Fees earned)

&- 3,000 (cash) -

3,000 (Rentexpense)

8 -
750 (cash) -

750 (accounts payable)

0 +
5,000 (accounts receivable) 5,000
-

(Fees earned)
↳ Billed customers

8-900 (cash) -

I +

I
600

300
(Auto expense)
(Misc. expenses
I
& -

1,800 (cash) -

1,800 (salaries expense)

& -
500
(supplies) - 500
(supplies expense)

8-1,500 (cash) -

1,500 (Eisen, Drawing

⑰ Using accounts to recordtransaction

Title
I account
-

Debit Credit

I
of accounts List of the accounts
group

leger of
chart accounts

& Double-entry accounting system

pebitliability accounts
accounts
Asset accounts - -
Equity
accounts t Revenue accounts -

Expense
Credit Debit Credit Credit
Debit Credit Debit
7
7
7
7
Debit - Credit

Increases), Decreases
-

II
~ ~

↓ ->

I e
↓
debitbalance credit balance credit balance no balance

withdrawals
Owner
Debit
Drawing7
account
credit

-
 Journalizing process

① Analyze transactions
E Cash
Chris
P $25,000
Clark, Capital
Debit
=>

125,000 => Credit 1 => think

② Apply rules
Journal entry Now 1. Dr. Cash 25,000

Cr. Chris Clark, Capital 25,000

1 =) write

& Posting to T-accounts Cash Capital

Nov 1 25,008 Mor 1 25,000

④Journalizing
⑳ Dr. Cash 18,000 Tran Khanh
Cr. Ken, Capital 18,000

⑯ Dr. Automobile 19,500

Cr. cash 2,500
Cr. acc.
payable 17,000

⑥ Dr. Rent expense 3,150

Cr. cash 3,150

⑪ Dr.
Supplies 1,450
Cr. cash 1,450

② Dr.
equipment 6,500
6,500
Cr, 92,
payable
⑰ Dr. -
Prepaidinsurance 2,400
Cr. cash 2,400

⑧ Dr. Cash 12,000

Cr. revenue 12,000

② Dr. acc. payable 1,800

Cr. cash 1,800

⑪ Dr. miscellaneous
exp
375

Cr. cash 375

28Dr. blueprintexpense 2,500

Cr. ace
payable 2,508

⑫ Dr. aca receivable 15,650

Cr. fees earned 15,650
① Dr. salary exp 2,800
Cr. cash 2,800

⑪ Dr. Miscellaneous exp 200

Cr. cash 208

⑰ We
payable 300
Cr. cash 300

⑳ Dr. Automobil exp 550

Cr. cash 550

③ Posting journal entry account

to

Whataccounts are affectedby that

-
1:Analyze transactions transaction?
W
Iow How are

much?
effects?
the (Y/1)
Step2:Journalize in
journals (Dr. cr.)

Step3:Post to
ledger account

Trial balance
Step4:
Assets -> Dr, balance = [Dr -ICr

The
adjusting process

① Analyze transactions

↓
② Journalize

↓
⑥ Postto ledger accounts

④ Prepare a trial balance ->

unadjusted
↓
⑤
Adjustment entries

8
↓
Adjustedtrial balance I
Rent a house

I I I I

17 5/7 31/7 5/8

↓
-
$$$
1/7 Dr. Rent unsuitable

Es
expense ->

Prepaidexpense
-

Cr. Cash ↳

8 Dr. Rent expense ->unsuitable Dr. Expense

Cr. Cash ↳3117 Cr. Payable
 ↳8 so dontich

-
Accrual basis basis
Revenue recognized when earned Revenue when
are are
recognized

Expenses are
recognized when incurred
-
Expenses are reareceived
cash
-
is paid

I ↑
Medium businesses
Big& Small businesses
(sole tracker)
->

P
->
⑭
GAAP

Hitting
entries

incurred
$
-$
-

Expenses I X

⑦ prepaid expense 2 S
accrued
-

(asset)
*
③ - expense
(payable)

+$ earned
+ $
Revenue I X I

⑦ earned revenue ↳
a
erned/revenue
x
(liability) (receivable)
id
expenses

E.g. 1 month
100 200
=
=

01/12:Dr. PrepaidInsurance 2,408

Cr. Cash 2,400

31/ 12:Dr. Expense

Insurance 208

Cr. Prepaid Insurance 200

I

sin: Dr. I. Exp 200

Cr. Prepaid I. 200

Unearned revenues
-

01/12: Dr. Cash 360

Cr. Unearnedrent revenue 300

31/12: Dr. Unearnedrent revenue 120

Cr. Rent Revenue 128

31/1: Dr. Unearnedrent revenue 120

Cr. Rent revenue 128

28/2: Dr. Unearned rent revenue 120

Cr. Rent revenue 128

 Accruedrevenues
-

15Dec 31 Dec 15 Jan 20 Jan

S
I I I

earned ↓ ↓
signed revenue is

billed $
+

25hours

31 Dec Adjentry

Dr. Account receivable 500

Cr. Fees earned 500

20 Jan received
payment $500
of

Dr. Cash 500

Cr. Accountreceivable 500

Emeral
expenses

I I
-

$
7

15/8
1/7 31/7

wage-July
31
July Dr.
Wage expense 1000

Cr.
Wage payable 1008

15
Ang Dr.
Wage payable 1000

Cr. Cash 1000

1. three-year
A
premium paid on a fire insurance
policy -

Prepaidexpense
2. Fees earned butnot received. Accrued
yet revenue
-

3. Fees received butnot

yet earned - Unearned revenue

owed butnotyet
4. Salary paid - Accrued
expense
5. Subcriptions in advance
by a
magazine publisher - Unearnedrevenue
-

6. Supplies on hand
7. Taxes owedbutpayable in
following period
the -
Accrued expense
8. Utilities owedbut
yet paid
not - Accrued
expense

Expense incurred cash is paid

1.
Prepaid No Yes
expense

Yes
Accrued experien
2. No

Revenue earned cash is received

1. nearned revenue No Yes

2. Accrued revenue Yes No

(receivable)
rreciation
-
expenses

Cost:18,000,000

Now:15,000,000 73,000,000
depreciation lexpense(Khanhav
amount

D
Fixedassets life ( year)
-
thathave
long 1

-
Decrease in usefulness
Land
-
Not
apply to & Supplies

(fixed)
office equipment ->
asset

depreciates
↓

$50
⑪ ②
depreciation expense Accumulateddepreciation office equipment

!
-

$50 I $50
Khanhas tich lin

kodegligia truc tiesgiant

citie

Dr. Depreciation expense taikhoah

->
trung gian
Cr. Accumulated depreciation accumulateddepreciation

Book ->
Fixedassets

Office equipment: $1,000

Less:Accumulated Depreciation (50)

Netbook value 950

 lies

Dec 1 Purchased$2,000 of
supplies
Dr. Supplies 2,000

Cr. Cash 2,000

Dec 31 Supplies on hand $760

Supplies used 2,000
= -
760

1,240 ->
expense
=

Dr. Supplies expense 1,240

Cr. 1,240
Supplies

PR 3 -
5A

01 Dr. Insurance 1,000

expense
Cr.
Prepaid insurance 1,800

1, Dr. Supplies expense 1,605

Cr. Supplies 1,605

c) Dr.
Depreciation
expense 6,000
Cr. Accumulateddepreciation -

Building 6,008

di Dr.
Depreciation
expense 3,000
Cr. Accumulateddepreciation -

Equipment 3,000

es Dr. Hnearned rent 5,400

Cr.Rent revenue 5,400

Is Dr. Salaries and Wages Expense 2,900

Cr. Salaries and
Wages Payable 2,900

Accountreceivable
18,60018,600
Dr.
9)
Cr. Fees earned
 Debit Credit
Cash 7,500
AccountReceivable 57,000
Prepaidinsurance 5,400

Supplies 375
Land 112,500

Building 150,250
Accumulateddepreciation -

Building 93,558
Equipment 135,300
Accumulated depreciation Equipment
-
100,950
Accounts
Payable 12,150
Salaries
Wages Payable
and 2,900
Unearned rent 1,358

Capital stock 75,000

Retained 146,000
earnings
Dividends 15,000
Fees earned 343,200
Rentrevenue 5,400

Salaries and
Wages Expense 196,278
Utilities expense 42,375

Advertising expense 22,800

Repairs expense 17.250

Miscellaneous expense 6,075
Insurance 1,800
expense
Depreciation expense
-

Building 6,000

Depreciation
expense -

Equipment 3,000

Supplies Expense 1,605

 -
Profit/Loss
↓ --
Asset = Liabilities +

Equity + Revenue
Expense -

en
-
permanentaccounts temporary accounts

nancial
4 Statement

1) Balance Sheet / Statement ofFinancial Position

2) Income Statement) Statement of Profit& Loss

Statementof Owner's
3) equity

2) Statement of Cash flow

(<I year (taisan again hase

went
assets:
-

Accounts receivable oral

->

promises
-Notes receivable written
promises
->

Supplies
-

Other
prepaidexpenses

-
erty, plant, and
equipment(non-currentassets) (31 year)

Equipment
-

Machinery
-

Buildings
- Land (notdepreciate)
 rentabilitieasnda
Accounts
-

payable
-Notes
payable
-Interest payable
- Unearnedrevenue

re
-Bank Loan

-
Notes
payable

wer's
Equity
OE
Capital Income/Loss
Net
Drawings
-

= 1

I
1. Common Stock -
owners'
equity
2. Notes receivable (due in six months) -
currentassets

3. Notes
payable (due in 10
years) -
non-current liabilities
4. Land -
non-current assets

5. Cash - currentassets

6. Unearnedrent (3 months) current liabilities

I so trong
-

7. AccumulatedDepreciation -

Equipment -
non-current assets am

8. Accounts
payable - current liabilities balance
sheet I

Gian gia'tri/von
de dan
->
am
 Merchandising Businesses
• sell tangible goods

Operating Cycle of a Merchandising Business

Capital -> Purchasing -> Sales -> Collection

Financial Statements

Service Business Merchandising Business

1. Income Statement 1. Income Statement

x Sales Revenue x
Service Revenue
-
Less: Expenses Cost of goods sold (x)

Advertising expense x ——————————

Gross Profit / Loss x / (x)

Rent expense x -

Less: Other expenses

Net Income/Loss x / (x)
Advertising expense x

Rent expense x

——————————
Net Income / Loss x / (x)
- Discounts

Cash discount / Trade discount

Early settlement

Pay the amount due early -> discount Buy in large amounts -> discount

Credit term 2/10, n/30

2% discount - 10 days

net - 30 days

Mar. 10. Dr. All receivable

Cr. Sales revenue

Mar. 19. Dr. Cash

-mes
Discounts

I
tri Cr. All receivable
khong truc

tiepvoo sales revenue

PE 6-3A

a) Dr. Account Receivable 41,108

Cr. Sales Revenue 41,108

Dr. Cost goods sold

of 26,750
Cr. Merchandise inventory 26,750
 b) Dr. Cash 40, 278
↓) Dr. Sales discount 822

Cr. AccountReceivable 41,100

expense

PE 6-2A

After
a) returning inventory:12,650 3,950 8,700
- =

The amountof cash required

<pay the
invoice within the discount period)

8,700 -

8,700 0.02x 8,526

=

b) Cr.
Inventory 8,700

buyer 2% => revenue

disman, giamthing
gia tri
/

seller 2% (sales discount) hoa

=
expense hang
 Purchases returns and Allowances

memo -> documentrecording reasons return

to

May 2. Dr. Merchandise

Inventory 5,000

Cr. AIC payable 5,000

May 4. Dr. A/C Payable 3,000

Cr. Merchandise
Inventory 3,000

May 12. Dr. AIC Payable 2,000

Cr. Cash 1,960
Cr. Merchandise Inventory 48

Sales returns and Allowances

credit document the returns.

-
memo ->
approving

Contra -
Account

Assets Account >< Accumulated Depreciation Account

Sales revenue account >< Sales discount account &

Sales returns account

 Freight
-
Inventory
-

shipping
point ->
Buyer pays freight
Dr. Merchandise
Inventory XX

Cr. Cash XX

/
~+ Delivery expense
destination
#
-> Seller
pays freight FreightOut

Dr.
Delivery expense XX

Cr. Cash XX

Dr.
June 10
Inventory 908
Cr. 900
A/C payable
Purchasedmerchandise from
Magna Data,
FOB
terms
shipping point

18 Dr. Inventory 58

Cr. Cash 50

Paid on merchandise
shipping cost
purchased

June 15 Dr. All receivable 100

Cr. Sales revenue 700

Dr. Costof goods sold 480

Cr. 480
Inventory

15 Dr. Delivery expense 40

Cr. Cash 40
Sales tax

VAT:
tue'gian thu

The seller wouldrecord sale of $100

E.g.: a on account, subjectto
a tax

6%
of

Dr. Accountreceivable 106

Cr. Sales revenue 100

Cr. Sales tax

payable 6

say
Dr. Sales taxpayable 6

Cr. Cash 6

Income Statement

Sales Revenue X

Sales Discount (x)

Sales Returns & Allowance (x)

NetSales X

Cost of goods sold (x)

Gross Profit X

Less:Other expenses
...
Delivery expense (x)
Total Other
expenses (x)

NetIncome X
 Foldaway Furnishing Company
Income Statement
for the ended 28 2014
year February

Sales Revenue 2,850,000

Sales Discount (25,000)
Sales Returns & Allowance (90,000)
NetSales 2,735,000

Cost of goods sold (1,641,000)

Gross Profit 1,094,000

Less:Other expenses
Administrative expenses (290,000)
Interestexpense 229,000)
Selling expenses (300,000)

Total Other
expenses (619,000)
NetIncome 475,000
 Foldaway Balance
Furnishing
Sheet
Company
for the ended 28 2014
year February
Assets Liabilities
Current Assets Current liabilities
Cash 97,000 Notes
Payable 400,000
Merchandise Inventory 260,000 Salaries Payable 6,000
office supplies 20,000
Store
Supplies 65,000 Total liabilities 406,000
Total current assets 442,000

Equity
Owners'
Non-currentassets Capital 591,000
Building (50,000)
1,130,000 Drawing
Accumulateddepreciation
Building (150,000) NetIncome 475,000
-

Total non-current assets 980,000 Total Owners' Equity 1,016,088

Total Assets 1,422,000 Total liabilities & Owners' 1,422,000

Equity
 Financial Analysis
mental
I
Analysis
Increase
-
(Decrease)
2014 2013 Amount Percent
CurrentAssets 550,000 533,000 17,000 3.2%

Plantassets (net) 444,508 470,000 (25,500) (5.4%)

Trial
Analysis

Profitabilityratios
Liquidityratios ->
abilityto convertassets into
cash

Solvency ratios ->

ability
of a business
pay
to its debts

Solvency
Working Capital CurrentAssets Currentliabilities
= -

-Currentratio

CurrentAssets
Currentratio:
CurrentLiabilities

2016 2015

WCap 310,500 172,500 138,000

-
=
262,500 -

150,000 112,500
=

10508
Current 1.8
=
times 1.75 times

ratio
 Sales
Ratio of Sales to
Assets =

total assets
Avarage
↓
How
effectively a business is

its assets
using to generate revenue

Specific FIFO LIFG WACC

I weighted
average,
identification inventory
inventory
Danh machothing Overstate the-Less taxes
-
-

sp profit
-

Goods which are

be expired
easy to

I
Recession Inflation

Profit >
ProfitiLIFos Profit Profit
(FIF0) (FIFOS (LIF0)
 Valuation
Inventory
of at lower-of-Cost -

or
-
Market

Ex. Total Cost Total Market

C17Y 390 400
B563 770 686

-> B563 should be recordedat lower value

Dr. Costofgoods sold
Cr.
Inventory
8484

-Costof goods sold

Inventory turnover
Average Inventory

Number Average Inventory

Days'
of Sales -

in
Inventory Average Daily Cost of
Merchandise Sold

Straight-line depreciation Double-Declining Balance Method

-

Dep. exp
Depreciation expense S

12,000

i
.... i >

year
1 -
- W
"
10 year
 FIFO

hang vo trus
->

7
un tie ban het ↳
Lang vo
<
-

hang
/

vao truc san

LIFO

hang vo tra
->
↳
hang vo san

↳nutienbanare

AVCO

Tinh tong lg, gial tri hang

S -

-> so
↑

giatrung birth maysp

↳