CHAPTER 1: Introduction

INTRODUCTION

 Accounting is an informational system that plans, analyzes, records and

reports financial information.
 Accountant is someone who summarizes detailed accounting information
and then analyzes and interprets that information to assist owners and
managers in making final decisions.
 Business is an economic entity that endeavors to sell goods and services to
customers at prices that will cover the costs of doing business and return a
profit to the owners.
 INTRODUCTION

 Management Information System (MIS) consists of several computer

integrated systems that provide all the information needs of the business.

 Business owners, managers, accountants, bookkeepers and accounting

clerks need to know how to use modern MIS computerized accounting
systems to perform accounting tasks efficiently.
 INTRODUCTION

 Integrated Accounting software is

designed to handle
 general ledger  budgeting
 accounts payable  fixed assets
 accounts receivable  purchase order processing
 financial statement analysis  sales order processing
processing
 Inventory
 bank reconciliation
 payroll.
 INTRODUCTION

 Integrated Accounting software uses a standard Windows user interface

that includes:
 Drop-down menus
 Toolbar
 Navigation buttons
 Movable overlapping windows
 On-screen help
 Other operational conventions
 INSTALLATION & MEMORY
REQUIREMENTS
 Requirements
 Processor running in the Windows 95, 98, NT, 2000, Me, XP or Vista
environment
 Hard drive w/ at least 15 mb of available disk space
 CD drive
 Printer (optional, but highly recommended)
 INSTALLATION & MEMORY
REQUIREMENTS
 Requirements  Installation
 Processor running in the Windows  Compressed Integrated
95, 98, NT, 2000, Me, XP or Vista Accounting program files
environment
 Opening balance files
 Hard drive w/ at least 15 mb of
 Student solution check files
available disk space
 Optional spreadsheet
 CD drive
 Word processing files
 Printer (optional, but highly
recommended)
 INTEGRATED ACCOUNTING START-UP

 After installation is completed, you can begin working with Integrated

Accounting by performing the following steps:
1. Click the Windows Start button
2. Click or select Programs
3. Position the pointer on Integrated accounting software
4. Click on Integrated accounting version 7 when submenu appears
 INTEGRATED ACCOUNTING START-UP

 Several components:
 Title bar
 Menu bar
 Toolbar buttons
 Tooltips
 Navigation button
Figure 1.1 Integrated Accounting Application Window
 OPERATING PROCEDURES

 Menu bar  Help system

 Menu item selection  On-screen calculator
 Window controls  Planning tools
 Selecting text  Accounting review drills
 Other special features  Explore accounting system
 Information/web browser
 Student solution checking feature
 The Menu Bar

 One way of communicating w/ the computer is to use the menu bar.

 Contains menu titles:
 File
 Edit
 Data
 Options
 Reports menu items
 Extras
 Window
 Help
 The Menu Bar
Drop-down menu displays a
list of menu items below the
menu title selected.

Figure 1.2 File Drop-Down Menu

 Window Controls

 Window is a rectangular area of the screen in which the software is

communicating with the user.
 often the display screen contains only one window. Though 2 or more
overlapping windows may appear on the screen at once, only one window
is active at a time.
 Operational Controls

 Tabs
 Text boxes
 Grid cells
 List boxes
 Drop-down list
 Option buttons
 Check boxes
 Command buttons
 Operational Controls
(TABS)
TABS provide for additional
entry of data, options and
processing.

Figure 1.3 Tabs in the Account Maintenance

Window
 Operational Controls
(TEXT BOXES)
TEXT BOXES where users can
type information. The user
can accept, the current text,
edit it or delete it.

Figure 1.4 Text

Figure 1.5 Text
Boxes
Boxes with
Selected text
 Operational Controls
(GRID CELLS)
GRID CELLS are arrangements
of rows and columns that, like
textboxes are used to enter,
edit or delete data and text.

Figure 1.6 Example of Grid Cells

 Operational Controls
(LIST BOXES)
LIST BOXES is used to display
choices for the user.

Figure 1.7 List Box

 Operational Controls
(DROP-DOWN LIST)
DROP-DOWN LIST consists of a
text box with a dropdown
arrow button immediately to
the right.
The text must be selected
from among the items in the
drop-down list.
The drop down list does not
allow the user to enter, into
the text box, new data not
currently existing in the list.
 Operational Controls
(OPTION BUTTONS)
OPTION BUTTONS (sometimes
referred to as radio buttons)
represent a single choice
within a set of mutually
exclusive choices.

Figure 1.10 Option Buttons within a

Group Box
 Operational Controls
(CHECK BOXES)
CHECK BOXES are used to
control the selection of
individual choices.
When a task requiring
multiple choices is selected ,
a group section will appear
containing check boxes ( )
to the left of each choice

Figure 1.11 Check Boxes

 Operational Controls
(COMMAND BUTTONS)
COMMAND BUTTON is a
rectangular shaped figure
containing a label that
specifies an immediate
action or response that will
be taken by the computer
when it is chosen.

Figure 1.12 Command Buttons

 MENU BAR
(File Menu)
When the File menu is
selected from the menu bar,
the drop-down menu
appears.
Menu items:
 Open
 Close
 Save
 Save as
 Print
 Print setup Figure 1.2 File Drop-Down Menu
 Change printer font
 Exit
 File menu item
( Open )
The Open menu item is used
to load a data file stored on
disk into the computer’s
memory for processing.

Figure 1.13 Open Dialog Box

 File menu item

Close
 Use to close the current file
displayed in the active window
(removes the data from the
computer’s memory.
Save
 Use the Save menu item in the File
menu to store your data to a disk
so that you can continue a
problem in a later session.

 When close is chosen, the active

window and all other windows
containing data from the same
files are closed.
 File menu item

Save As Print
 Same as Save except that the  The purpose of Print is to create a
data can be saved with a path or printed version of the contents
file name different from the currently displayed in a report or
current path and file name. graphic window.
 Useful for making a backup copy
of a data file.
 To make a backup copy, open
the data file you wish to back up
and use Save As to save it, under
a different name.
 File menu item

Print Setup Change Printer Font

 Clicking the Print button while a  When reports are printed to an
report is displayed or choosing the attached printer, Integrated
Print Setup menu item from the Accounting uses font, font style
File menu brings up a Print Setup and size specified in the printer’s
dialog box. Font dialog box.
 Offers choices about the printer(s)
connected to your computer,
such as desired paper size and
printing enhancements.
 File menu item

Exit
 Used to end Integrated
Accounting.
 When chosen, the computer
checks to see whether the current
data in its memory has been
saved. If not, a dialog box will
appear asking if you wish to save
your data to disk.
 Edit Menu

 Contains several menu items that can be used to remove and copy data
from one location within Integrated Accounting or from other application
programs.
 Edit menu items:
 Cut
 Copy
 Paste
 Find
 Find next
 Edit Menu
( Cut, Copy, Paste)
The Cut and Copy menu
items in the Edit menu may
be used to place copies of
the current selection to the
clipboard, a temporary
storage area, in preparation
for being pasted elsewhere.

Figure 1.14 Edit Menu

 HELP SYSTEM

 To access HELP:
1. Choose the Help Contents and Index menu item from Help menu
2. Press the F1 function key at any time
3. Choose the Help command button that appears at the bottom of various
wind
 HELP SYSTEM
The Help window consists of
two frames.
1. Frame on the left contains
tabs that display the
contents, an index or
search option .
2. Frame on the right displays
the detailed information of
the corresponding topic
selected in the left frame.

Figure 1.15 Help Window

 HELP SYSTEM
When using the F1 key or the
Help command button, the
topic that is selected and
displayed depends on which
Help menu item you choose
or which window you were
using when you choose the
Help button.

Figure 1.16 Help Window ( Saving a

File)
 HELP SYSTEM
Use Index and Search tabs to
find words or topics quickly.

Figure 1.17 Help Window ( Using

Index Tab)
 ON-SCREEN
CALCULATOR
 the on-screen calculator is
operated like a handheld
calculator
 Your computer’s standard
calculator can perform all
the calculations required.
 The results can be copied
and pasted into the text
box that has the focus.

Figure 1.18 Standard On-Screen

Calculator
 PLANNING
TOOLS
 Are convenient, fast, easy-
to-use ways of producing
results for commonly used
applications.

 NOTE: An accounting file

does not have to be
loaded into memory to use
any of the planning tools.

Figure 1.19 College Planner

 EXPLORE
ACCOUNTING SYSTEM
 when chosen, the Explore
Accounting System will
appear.
 Used to access data
stored by the software to
perform audit checks,
check account activity,
isolate errors and other
tasks helpful to managing
account information.

Figure 1.26 Explore Accounting

System Window
 INFORMATION & THE
INTERNET WEB
BROWSER
 When a file is loaded into
the Integrated Accounting
software, it is checked to
determine if there is
additional information
helpful for problem
solution. If such information
exists, a dialog box is
displayed indicating that
this information may be
displayed now.

Figure 1.27 Web Browser

 INFORMATION & THE INTERNET WEB
BROWSER
 When a file is loaded into the Integrated Accounting software, it is checked
to determine if there is additional information helpful for problem solution. If
such information exists, a dialog box is displayed indicating that this
information may be displayed now.
 3 different types of information provided by Integrated Accounting
software
1. Step-by-step problem instructions
2. Problem check figures
3. Instructions for using your browser to access the internet
 STUDENT SOLUTION
CHECKING
 May be used to assist you
in checking your work.
Once, you have saved
your work, the Check
toolbar button will become
active.
 A detailed report will be
generated identifying any
discrepancies between
the solution key file and
your work.

Figure 1.28 Student Solution

Checker Report & Explore
Information
 STUDENT SOLUTION CHECKING

 The software checks the following items:

 Accounting system
 Fixed assets
 Payroll
 inventory
 ACCOUNTING REVIEW

 Chart of Accounts lists all the accounts used by a business. Each account
consists of an account number and account title.
 in a manual accounting system, each account is kept on a separate sheet
of paper on a legal-sized, cardboard-like card.
 General ledger book or file drawer where the sheets of paper or cards,
placed together.
 Accounting Equation

ASSETS = LIABILITIES + OWNER’S EQUITY

The accounting equation must always be equal. Total amount on the left
side must equal to the total of the amounts on the right side.
 Transactions and the Accounting
Equation
 Each transaction causes increases or decreases in assets, liabilities or
owner’s equity
 Increases and decreases that are caused by a transaction are recorded in
specific accounts.
 Each account has as account balance and an account title.
Transactions and the
Accounting Equation
 Sept. 1 Received cash
from owner as an
investment, $14,000.00
 2 Paid cash for
supplies, $335.00
 3 Paid cash for
insurance $750.00
 4 Bought supplies on
account, $2500.00
 6 Paid cash on
account, $1500.00

Figure 1.12 Transactions Entered into

Accounting Equation
Transactions and the
Accounting Equation
 After all the transactions
have been entered into
the accounting equation
and stored by the
computer an accounting
equation report can be
generated.

Figure 1.21 Accounting Equation

Report
 Classifying Accounts
& Analyzing
Transactions
 Transactions that result
from a business’s operation
must be recorded in the
accounting system. Before
transactions can be
recorded, they must be
analyzed and assigned to
their appropriate
accounts.
 All accounts used by a
business are stored in the
general ledger and
grouped into their
appropriate categories via
an account classification.
Figure 1.22 Chart of Accounts
 Double-Entry Accounting System

 Based on recording debit and credit parts of transaction so that the total
amount of debits and credits equal each other.
 Each transaction affects at least two general ledger accounts. At least one
debit or credit is recorded in such a way that the entire system is always in
balance.
 The T Account
Parts:
 Account title
 Debit side ( left side )
 Credit side ( right side )

Figure 1.24 Accounting Equation (

with T account)
 Three Analytical Questions

1. What general ledger accounts are affected?

2. How is each of the affected accounts classified?
3. How is each amount entered in the affected accounts?