会计学原理英文课件Chapter-04ACCOUNTING-CYCLE

ACCOUNTINGCYCLEChapter4BENEFITSOFAWORKSHEETAidsthepreparationoffinancialstatements.Reducespossibilityoferrors.Linksaccountsandtheiradjustments.Assistsinplanningandorganizinganaudit.Helpsinpreparinginterimfinancialstatements.Showstheeffectsofproposedtransactions.Notarequiredreport.P1FastForward

WorkSheetForMonthEndedDecember31,2009First,entertheunadjustedamountstotheworksheet.P1FastForward

WorkSheetForMonthEndedDecember31,2007Sortadjustedtrialbalance

amountstofinancialstatements.P1FastForward

WorkSheetForMonthEndedDecember31,2007Totalstatementcolumns,computeincomeorloss,andbalancecolumns.P1

PreparetheIncomeStatement.PREPARETHEFINANCIALSTATEMENTSAworksheetdoesnotsubstituteforfinancialstatements.P1

PreparetheStatementofOwner’sEquity.

P1

PreparetheBalanceSheet.

CLOSINGPROCESSResetsrevenue,expenseandwithdrawalaccountbalancestozero

attheendoftheperiod.Helpssummarizeaperiod’srevenuesandexpensesintheIncomeSummary

account.Identifyaccounts

forclosing.Record

andpost

closingentries.Preparepost-closing

trialbalance.C1TemporaryAccountsRevenuesIncomeSummaryExpensesWithdrawalsPermanentAccountsAssetsLiabilitiesOwner’sCapitalTEMPORARYAND

PERMANENTACCOUNTSTheclosingprocessappliesonlytotemporaryaccounts.C1Let’sseehowtheclosingprocessworks!RECORDINGCLOSINGENTRIESCloseRevenueaccountstoIncomeSummary.

CloseExpenseaccountstoIncomeSummary.

CloseIncomeSummaryaccounttoOwner’sCapital.

CloseWithdrawalstoOwner’sCapital.P2Usingtheadjustedtrialbalance,let’spreparetheclosingentriesforFastForward.P2CloseRevenueaccountstoIncomeSummary.P2CLOSEREVENUEACCOUNTS

TOINCOMESUMMARYNow,let’slookattheledgeraccountsafterpostingthisclosingentry.

Dr.Cr.Dec.31Consultingrevenue7,850

Rentalrevenue300

Incomesummary

8,150P2CLOSEREVENUEACCOUNTS

TOINCOMESUMMARYP2CloseExpenseaccountstoIncomeSummary.P2Now,let’slookattheledgeraccountsafterpostingthisclosingentry.CLOSEEXPENSEACCOUNTS

TOINCOMESUMMARYP2NetIncomeCLOSEEXPENSEACCOUNTS

TOINCOMESUMMARY

P2CloseIncomeSummarytoOwner’sCapital.P2Now,let’slookattheledgeraccountsafterpostingthisclosingentry.CLOSEINCOMESUMMARY

TOOWNER’SCAPITALP2

CLOSEINCOMESUMMARY

TOOWNER’SCAPITALP2CloseWithdrawalstoOwner’sCapital.P2Now,let’slookattheledgeraccountsafterpostingthisclosingentry.CLOSEWITHDRAWALS

TOOWNER’SCAPITALP2CLOSEWITHDRAWALS

TOOWNER’SCAPITALP2Let’slookatFastForward’s

post-closingtrialbalance.POST-CLOSINGTRIALBALANCEListofpermanentaccountsandtheirbalancesafterpostingclosingentries.

Totaldebitsandcreditsmustbeequal.P3POST-CLOSINGTRIALBALANCEP3StepsintheAccountingCycleC2Currentitemsarethoseexpectedtocomedue(bothcollectedandowed)withinthelongerofoneyearorthecompany’snormaloperatingcycle.CLASSIFIEDBALANCESHEETC3Currentassetsareexpectedtobesold,collected,orusedwithinoneyearorthecompany’soperatingcycle.C3Long-terminvestmentsareexpectedtobeheldformorethanoneyearortheoperatingcycle.C3Plantassetsaretangiblelong-livedassetsusedtoproduceorsellproductsandservices.C3Intangibleassetsarelong-termresourcesusedtoproduceorsellproductsandservicesandthatlackphysicalform.C3Currentliabilitiesareobligationsduewithinthelongerofoneyearorthecompany’soperati