会计学原理 第三单元.pptVIP

Chapter 3 Adjusting Accounts and Preparing Financial Statements Conceptual Chapter Objectives C1: Explain the importance of periodic reporting and the time period principle C2: Explain accrual accounting and how it improves financial statements C3: Identify the types of adjustments and their purpose Analytical Chapter Objectives A1: Explain how accounting adjustments link to financial statements A2: Compute profit margin and describe its use in analyzing company performance Procedural Chapter Objectives P1: Prepare and explain adjusting entries P2: Explain and prepare an adjusted trial balance P3: Prepare financial statements from an adjusted trial balance P4: Appendix A: Identify and explain alternatives in accounting for prepaids The Accounting Period Accrual Basis vs. Cash Basis Accrual Basis vs. Cash Basis Accrual Basis vs. Cash Basis Recognizing Revenues Expenses Revenue Recognition Recognizing Revenues Expenses Revenue Recognition Matching Adjusting Accounts Adjusting Prepaid (Deferred) Expenses Prepaid Insurance On December 1, 2007, Scott Company paid $12,000 for insurance for December 2007 through May 2008. Scott recorded the expenditure as Prepaid Insurance on December 1. What adjustment is required? Supplies During 2007, Scott Company purchased $15,500 of supplies. Scott recorded the expenditures as Supplies. On December 31, a count of the supplies indicated $2,655 on hand. What adjustment is required? Adjusting for Depreciation Depreciation is the process of computing expense from allocating the cost of plant and equipment over their expected useful lives. Adjusting for Depreciation On January 1, 2007, Barton, Inc. purchased equipment for $62,000 cash. The equipment has an estimated useful life of five years and Barton expects to sell the equipment at the end of its life for $2,000 cash. Let’s record depreciation expense for the year ended December 31, 2007. Adjusting for Depreciation Adjusting for Depreciation Adjusting