tailieunhanh - Lecture Financial accounting: Tools for business decision-making (7th edition) – Chapter 4

Chapter 4 - Accrual accounting concepts. This chapter include objectives: Explain the accrual basis of accounting and the reasons for adjusting entries, prepare adjusting entries for prepayments, prepare adjusting entries for accruals, prepare an adjusted trial balance and financial statements, prepare closing entries and a post-closing trial balance. | CHAPTER 4: ACCRUAL ACCOUNTING CONCEPTS LO 1: Explain the accrual basis of accounting and the reasons for adjusting entries. LO 2: Prepare adjusting entries for prepayments. LO 3: Prepare adjusting entries for accruals. LO 4: Prepare an adjusted trial balance and financial statements. LO 5: Prepare closing entries and a post-closing trial balance. LEARNING OBJECTIVES Users require financial information on a regular basis Accounting divides the economic life of a business into time periods Month, quarter (three months), year One-year period is known as the fiscal year Shorter periods are known as interim periods Many transactions affect more than one time period Timing Issues Revenue: Increase in assets (or settlement of liabilities) Income that results from a company’s ordinary activities In general, revenue is recognized In a merchandising company when merchandise is sold and delivered (point of sale) In a service company when the service is performed Under ASPE, revenue can be . | CHAPTER 4: ACCRUAL ACCOUNTING CONCEPTS LO 1: Explain the accrual basis of accounting and the reasons for adjusting entries. LO 2: Prepare adjusting entries for prepayments. LO 3: Prepare adjusting entries for accruals. LO 4: Prepare an adjusted trial balance and financial statements. LO 5: Prepare closing entries and a post-closing trial balance. LEARNING OBJECTIVES Users require financial information on a regular basis Accounting divides the economic life of a business into time periods Month, quarter (three months), year One-year period is known as the fiscal year Shorter periods are known as interim periods Many transactions affect more than one time period Timing Issues Revenue: Increase in assets (or settlement of liabilities) Income that results from a company’s ordinary activities In general, revenue is recognized In a merchandising company when merchandise is sold and delivered (point of sale) In a service company when the service is performed Under ASPE, revenue can be recognized when: Performance of an obligation is substantially complete Revenue can be reliably measured Collection is reasonably certain Revenue Recognition Under IFRS, new revenue standard (effective January 1, 2018) Five-step process to measure and report revenue: 1. Identify the contract with the client or customer. 2. Identify the performance obligations in the contract. 3. Determine the transaction price. Allocate the transaction price to the performance obligations in the contract. Recognize revenue when (or as) the company satisfies the performance obligation. Revenue Recognition How might revenue be recognized for a large, publicly-traded transportation company? Compare this to how revenue might be recorded for a small convenience store. Discussion Questions 7 Expenses are recognized when: Due to ordinary activity, a decrease in future economic benefits occurs A decrease in an asset or an increase in a liability Can be measured reliably Tied to changes in assets and liabilities .

• Kế toán - Kiểm toán
• Financial accounting
• Lecture Financial accounting
• Financial statements
• Kế toán tài chính
• Accrual accounting
• Revenue recognition
• Issues in financial accounting
• Accounting standards
• Financial reporting
• Financial Accounting Standards Board
• Fundamental financial accounting
• Lecture Fundamental financial accounting concepts
• Financial statement
• Accounting cycle
• Accounting for accruals
• Accounting system
• Accounting activities
• Financial accounting practice
• Accounting information system
• Accounting terminology
• Reporting financial results
• Evaluating liquidity
• Business firms
• The financial reporting reform
• Accounting information
• Management accounting
• Accounting equation
• Accounting systems
• Decision making
• External financial reporting
• Accounting for business
• Lecture Accounting for business
• Financial accounting reports
• Statement of financial performance
• Accrual accounting systems
• Statement of financial position
• Mastering financial accounting essentials
• Financial accounting essentials
• Income statement
• Accounting conventions
• Internal control
• Accounting for cash
• Accounting for receivables
• Computing uncollectible accounts expense
• Long term debt
• Accounting for long term debt
• Paper F3
• Revision kit 2016
• Accounting Financial
• Accounting Financial Review
• Financial Review accounting exam
• Study text 2016
• Language of business
• Double entry accounting system
• Credit terminology
• Merchandising businesses
• Accounting for merchandising businesses
• Accounting for inventories
• Cash discounts
• The accounting cycle
• International financial reporting standards
• Completing the accounting cycle
• Accounting worksheet
• Classified balance sheet