tailieunhanh - Lecture Accounting and financial system - Lecture 5: Trial balance and end period adjustments

The main contents of the chapter consist of the following: Trial balance and errors, capital and revenue expenditure, accruals and prepayments, charging depreciation, inventory and cost of goods sold, preparation of extended trial balance, preparation of financial statements. | ACCOUNTING & FINANCIAL SYSTEMS MCPC 606 LECTURERS: DR. JOHN MACCARTHY & DR. MALIK ZAKARIA 1 1 Lecture 5: Trial Balance and End Period Adjustments Overview: Trial balance and Errors Capital and Revenue Expenditure Accruals and Prepayments Charging Depreciation Inventory and Cost of Goods Sold Preparation of Extended Trial Balance Preparation of Financial Statements 2 It is wrong to assume that after the trial balance is extracted, is absolutely correct without making adjustments to it. This requires that, we check the integrity of the figures in the trial balance. At this point, we pay attention to matching principles or expense recognition principle and post the necessary adjustments to the trial balance. Some adjustments include depreciation, cost of goods sold, accrued expenses and prepaid expenses. These adjustments are needed before preparing the financial statements. 3 Trial Balance and End Period Adjustments (cont.) Trial Balance and End Period Adjustments (cont.) Periodicity | ACCOUNTING & FINANCIAL SYSTEMS MCPC 606 LECTURERS: DR. JOHN MACCARTHY & DR. MALIK ZAKARIA 1 1 Lecture 5: Trial Balance and End Period Adjustments Overview: Trial balance and Errors Capital and Revenue Expenditure Accruals and Prepayments Charging Depreciation Inventory and Cost of Goods Sold Preparation of Extended Trial Balance Preparation of Financial Statements 2 It is wrong to assume that after the trial balance is extracted, is absolutely correct without making adjustments to it. This requires that, we check the integrity of the figures in the trial balance. At this point, we pay attention to matching principles or expense recognition principle and post the necessary adjustments to the trial balance. Some adjustments include depreciation, cost of goods sold, accrued expenses and prepaid expenses. These adjustments are needed before preparing the financial statements. 3 Trial Balance and End Period Adjustments (cont.) Trial Balance and End Period Adjustments (cont.) Periodicity Concept: This is an assumption that the business life is divided into appropriate segments for the purpose of financial statements analysis. Each divided segment is known as an accounting period and it is usually in 12 months. Some segments can be smaller like 6 months, 3 months (quarter) for analysis purposes. This is time interval at which the SOCI and SOFP are prepared in order to show the results of operations performance of the entity. At the end of this segment, the company’s financial performance and financial position is prepared for the users of the company. Trial Balance and End Period Adjustments (cont.) Accounting transactions are usually classified into income and expenditure items. Capital expenditures: These are expenditure incurred on the acquisition, installation of an assets that are intended to use for more than one accounting period. These are expenditures incurred with the intention to: Buy noncurrent assets, or Add to the value of an existing fixed asset . .

• Ngân hàng - Tín dụng
• Financial system
• Lecture Accounting and financial system
• Trial balance
• Period adjustments
• Revenue expenditure
• Cost of goods sold
• Financial statements
• Interpretation of financial statements
• Financial records
• Government grants
• Financial inclusion and growth of Indian banking system
• Financial inclusion of Indian banking system
• Growth of Indian banking system
• Challenges for financial inclusion
• Financial inclusion plays
• The financial system
• The payments system
• Interest rates
• Rates of return
• The stock market
• Financial market efficiency
• Determining interest rates
• Financial markets
• Financial institutions
• Financial Instruments
• Modern financial system
• Flow of funds
• Commercial banking
• Financial claims
• Modern financial system
• Impact of globalisation
• Functions of the financial system