...Adjusting to change and stereotypes Growing up, I was constantly going to new places I transferred to more than six high schools. So I am used to starting over, for that reason I know how to make friends easily with people I have thing in common with. In the story American Born Chinese Jin Wang the kid in the short story, and who was born in America. He goes to a new school everyone automatically labels him as “that Chinese kid” who eats dogs or who use to eat dogs. I can relate because in my sophomore year of high school I moved in with my aunt in Victoria, Texas. Once people find out you’re Native American they have thousands of questions, and stereotypes come into play, and I found myself being “that native girl” in school. Adjusting to change was difficult when you’re being judged for being so different. I found a way to accept it, and embrace it. My grandmother had told me before I left to Texas to always remember who I am, and where I came from. So, I did just that. I always got asked a lot was, to say something in my language. I could do that and it was amazing to see them react. I felt proud to be able to speak in my own language and introduce myself....
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...Topic 2 Chapter 16 The statement of comprehensive income and statement of changes in equity Review questions 16.2 There is a general requirement that unless a specific accounting standard requires an item of income or expense to be recorded directly in equity, the expense or income amount is to be included in profit or loss. Specifically, paragraph 88 of AASB 101 states: An entity shall recognise all items of income and expense in a period in profit or loss unless an Australian Accounting Standard requires or permits otherwise. As an example of one class of items that does not go to profit or loss we can consider the situation where an error from a prior period is discovered (perhaps the assets recorded last year were valued in excess of their recoverable value). In such a case the error is to be corrected retrospectively, as required by AASB 108 Accounting Policies, Changes in Accounting Estimates, and Errors. This would require a reduction in assets and a reduction in retained earnings to recognise the asset write-down expense. Although this is an expense that is recognised, it is a case of an expense being recognised directly in equity (retained earnings is an equity account). A number of other accounting standards also require certain income and expense items to be recorded directly in particular equity accounts rather than including them in a period’s profit or loss. These items form part of what is now referred to as ‘other comprehensive income for the year’—which...
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...Chapter 4: Adjusting the accounts and preparing financial statements 4.1: Measurement of profit Profit = Income – Expense • Profit may be recognized as either a cash basis or accrual basis: • Cash Basis: Income (inc. revenues) is recorded in the period in which cash is received and expenses are recorded in the period in which cash is paid. - This method does not recognize income when goods are sold and services are performed on credit - Costs of goods and services consumed during the current period, but not paid for, are recognized as expenses in a subsequent period when cash is paid - Good for small businesses, not so good for businesses whom conduct most of activities on credit or government. • Accrual basis: Income (inc. revenues) is recognized in the period in which the expected inflow of economic benefits can be measured in a faithful and verifiable manner i.e. in the period in which a business sells goods or performs services under a contractual agreement. - Provides a faithful representation of inflows and consumptions Income (inc. revenues): - Income represents increases in economic benefits during the period in the form of inflows or exchangements of assets or of decreases in liabilities that result in increased equity. Expenses: - Expenses recognized in the period which they are consumed - Costs incurred and expected to provide economic benefits in future period represents unexpired cost, is an asset recorded on the balance sheet - Cost of assets that...
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...double-entry rules. Explain how transactions affect the accounting equation. Identify the steps in the accounting cycle and the steps in the recording process. Explain the reasons for and prepare adjusting entries. Explain how the type of ownership structure affects the financial statements. Prepare closing entries and consider other matters relating to the closing process. Prepare a 10-column work sheet and financial statements. After studying Appendix 3A, you should be able to: Identify adjusting entries that may be reversed. THE ACCOUNTING INFORMATION SYSTEM The Accounting Information System Basic Terminology Event: The cause of changes of assets, liabilities, and equity Transaction: A transfer or exchange between two or more entities or parties Account: Where transactions are recorded - A separate account is used for each asset, liability, revenue, expense, gain, loss and capital (owner’s equity) Permanent accounts (or “real” accounts) * Asset, liability, and equity accounts * Appear on the balance sheet * Permanent accounts are not closed at year end Temporary accounts (or “nominal” accounts) * Revenue, expense, and dividend accounts * Revenue and expenses are on the income statement; dividends are on the statement of changes in shareholders equity. * Temporary accounts are closed at year end Journalizing and Posting * A Journal is a book of original entry for all transactions * The General Journal...
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...representatives. It was brought to my attention that ADT and its affiliates are unclear about why the additional information was requested on the adjusting lower cost of market inventory on valuation, the capitalizing interest on building construction, the recording of gains or losses on asset disposal, and the adjusting goodwill for impairment. The adjusting lower cost of market inventory on valuation is specified in Accounting Research Bulletin No. 43 (ARB No. 43). The Statement of Financial Accounting Standards (SFAS) No. 34 is the statement, which deals with capitalization of interest as part of the cost of the asset. The SFAS No. 144 addresses the reporting and accounting for the impairment of the disposal of long-lived assets. New rules for the accounting for goodwill have been addressed in SFAS No. 142. To be able to complete the analysis of the work papers of my clients’, certain information must be obtained. To alleviate the concern of the client of why the information is requested analysis of each topic and its importance will be discussed in this paper. The adjusting lower cost of market inventory valuation is essential because through the life cycle of inventories, the inventories will decline in value. Although the primary basis of accounting for inventories is cost, when inventories usefulness become lower than cost, then the use of adjusting lower cost of market is accepted. There are many advocates that think that inventories should be valued at market price. The belief is...
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...journalizing transactions and adjusting entries, the accounting cycle involves closing entries and preparing a post-closing trial balance. I believe that the most important skills learned in an accounting position is to understand the basic equation of accounting, assets + liabilities + stockholder’s equity. Most accounting goes back to this equation as the basis for balancing accounts when transactions are journalize. The two types of accounting methods used to maintain financial records and prepare reports are the accrual and cash basis accounting. Accrual basis accounting is accepted under the Generally Accepted Accounting Principles (GAAP). This principle states that the accounting transactions are recognized and recorded when the expense or revenue actually occurred, not when cash changes hands (James, 2012). The benefit of accrual basis accounting is expenses and revenues which can be matched as they happen, and much more effective for monitoring cash flow (Epstein, n.d.). Accrual accounting has a more complicated recording process than cash basis accounting which can be a disadvantage when it comes time to pay taxes. Since this accounting method requires that expenses and revenue are recorded right away, the taxes must be paid on the recorded revenue; even if it’s not been paid (Reference For Business, 2012). The adjusting entries are recorded at the end of every accounting period after the trial balance. There are five types of adjusting entries that are made: accrued...
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...of the information requested are the (1) adjusting lower cost of market inventory on valuation, (2) capitalizing interest on building construction, (3) recording gain or loss on asset disposal, and (4) adjusting goodwill for impairment. To alleviate the concern of the client of why the information is requested analysis of each topic and its importance will be discussed in this paper. The adjusting lower cost of market inventory valuation is essential because through the life cycle of inventories the inventories will decline in value. Although the primary basis of accounting for inventories is cost when when inventories usefulness become lower than cost then the use of adjusting lower cost of market is accepted. There are many advocates that think that inventories should be valued at market price. The belief is assets should reflect current values. Generally Accepted Accounting Principles instructs that when inventories decline in value the future selling price should move in the same direction in the same time period. The American Institute of Certified Public Accountants provides the following definitions for use when applying the lower cost or market rule to inventories. These definitions are: 1. Market should not exceed the net realizable value. 2. Market should not be less than net realizable value reduced by an allowance for an approximately normal profit margin (Schroeder, Clark & Cathey, 2005, p. 256). Adjusting lower cost of market inventory valuation...
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...BANK RECONCILITAION A. Purpose and importance of bank reconciliation. * Purpose A Bank reconciliation is a process performed by a company to ensure that the company’s records (check register, general ledger account, balance sheet, etc.) are correct and that the bank’s records are also correct. For example, the balance on the bank statement is probably not the amount that appears in the company’s records. In all likelihood the checks written by the company in the days immediately before the date of the bank statement will not have cleared (been deducted from) the checking account. These are called outstanding checks. Another possibility is that the company received money on the closing date of the bank statement and properly recorded the amount in its records. However, the money was deposited into the bank too late in the day and will appear on the next bank statement. This is known as a deposit in transit. Let’s begin the bank reconciliation by assigning some amounts to the items just mentioned: Balance per bank statement at October 31 $6,442.56; outstanding checks as of October 31 $3,400.00; deposits in transit at October 31 $1,000.00. The adjusted balance per the bank statement on October 31 is $4,042.56 ($6,442.56 + $1,000.00 – $3,400.00). * Importance of Bank Reconciliatiom * Preparation of bank reconciliation helps in the identification of errors made in the records of the hotel or the bank. * Cash is the most vulnerable asset of an entity. Bank reconciliations...
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...the audit working papers. In the audit engagement acceptance or reappointment stage, audit evidence is the information that the auditor is to consider for the appointment. For examples, change in the entity control environment, inherent risk and nature of the entity business, and scope of audit work. Subsequent Event: Subsequent event is the accounting term for a financial transaction that occurs after completion of the balance sheet for a specified period but before the company’s full set of financial statements is prepared. Subsequent events clarify information about a business’ financial picture as reflected by the balance sheet, a financial report that includes all transactions through the report date. The Financial Accounting Standards Board, the authority entrusted with establishing generally accepted accounting principles, publishes detailed requirements for defining and recording subsequent events in financial records. Adjusting Event or Post Balance Sheet Events: Material events that occur between the date of preparation of financial statements and the date of their approval by the management. Such events must be reflected in the financial statements of a firm, to comply with the requirement of giving a 'true and fair view' of its financial position. A non-material (non adjusting) but significant...
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...The Accounting Cycle and Accrual Accounting Concepts Accounting Information System | Journal, Ledger Accounts, and Trial Balance | Cash-Basis Versus Accrual-Basis Accounting | Accrual Accounting Concepts | Adjusting Entries, Adjusted Trial Balance, and Closing | Self-Assessment After learning about the income statement and the balance sheet in Chapters 1 and 2, we are now being introduced to the accounting cycle and certain underlying accounting concepts that influence the contents of those two financial statements. | | Accounting Information System | | Just what, exactly, is the accounting information system? Is it a room full of computers and papers? Not necessarily. The accounting information system consists of data, papers to support the data, machines to process the data, and most importantly, people to report the resulting information to those who make decisions based on such information. Every organization that is engaged in transactions needs an accounting information system. This brings us to an important term used in accounting—a transaction! But what, exactly, is a transaction? Identifying Business Transactions A transaction is any event that involves an exchange or consumption of resources. A transaction could take place between a company and external parties (e.g., purchase of raw materials from suppliers or sale of merchandise to customers), or within a company itself (e.g., a company uses supplies that were purchased at a previous date and were...
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...An adjusted trial balance is a listing of the company accounts that will appear on the financial statements after the adjusting journal entries have been made. Preparing an adjusted trial balance is the last step before financial statements can be produced. The format of the adjusted trial balance is exactly like the unadjusted trial balance. The adjusted trial balance is presented by using the three columns and the ending balance for both debits and credits must be equal. After preparing the adjusted trial balance, the accounting cycle will continue with preparing the financial statements. Preparing the financial statements is the most important steps in the accounting cycle. Balance sheet, income statement, statement of changes in equity and statement of cash flows will be prepared in order to provide useful financial information to the external users. The income statement or known as profit and loss statement is a report that display the income and expenses of the company during the accounting period. The income statement also served to calculate the net income or loss of a company by deducting the total expenses from the total income and this calculation...
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...Chapter 3 1. | Accountants divide the economic life of a business into artificial time periods because of the time period assumption. A. | True | B. | False | | 2. | Which of the following time periods would not be referred to as an interim period? A. | Monthly | B. | Annually | C. | Semi-annually | D. | Quarterly | | 3. | An accounting time period that is one year in length is referred to as A. | a reporting period. | B. | a fiscal year. | C. | an interim period. | D. | a distressed year. | | | | 4. | The time period assumption states that A. | companies must wait until the calendar year is completed to prepare financial statements. | B. | companies use the fiscal year to report financial information. | C. | the economic life of a business can be divided into artificial time periods. | D. | companies record information in the time period in which the events occur. | | 5. | An accounting time period that is one year in length is A. | a calendar year. | B. | a fiscal year. | C. | an interim period. | D. | a quarterly period. | | 6. | The revenue recognition principle dictates that companies recognize revenue in the accounting period in which payment is received. A. | True | B. | False | | 7. | The revenue recognition principle dictates that revenue should be recognized in the accounting records A. | when cash is received. | B. | when performance obligation is satisfied. | C. | at the end of the month. | ...
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...complex mathematical techniques that may also be used as part of a 'toolbox' of methods that have evolved as aids in distillation control strategy selection. Introduction The effective operation of a binary distillation column is determined by the control of many variables. Generally, the variables in table 1 need to be controlled. cv reason composition of the distillate stream, xD composition of the bottoms stream, xB. liquid level in the reflux drum. liquid level at the base of the column. pressure in the column product quality product quality maintain inventory (ensure material balance) maintain inventory (ensure material balance) maintain inventory (ensure energy balance). Equilibrium relationship is affected by changes in pressure. Table 1. Typical variables that have to be maintained in a distillation column. The two main disturbances that affect a column are: • feed flowrate, F • feed composition, zf 1 So called 'manipulated variables' are adjusted to counter-act the effect of disturbances and ensure desired operation. But what are the manipulated variables ? Relationships between inputs (mv's and dv's) and outputs (cv's) are quantified by steady-state material and energy balances. To simplify preliminary discussions consider ‘perfect control’ of pressure (i.e. the energy balance equations are not considered). Steady-state material balances around a distillation column The following figure is a material...
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...Accounting Presentation Group members The Accounting Information of System The Personnel, procedures, devices, and records used by an organization to develop accounting information and communicate that information to decision makers The accounting process Economic activities Accounting “links” decision makers with economic activities and with the results of their decisions. Decision makers Accounting information Actions (decisions) Types of Accounting Information Financial Providing information about the financial resources, obligations, and activities of an economic entity that is intended for use primarily by external decision makers – investors and creditors. Managerial Providing information that is intended primarily for use by internal management in decision making required to run the business. return of investment The repayment to an investor of the amount originally invested in another enterprise. Basic Functions of an Accounting System Interpret and record business transactions. Classify similar transactions into useful reports. Summarize and communicate information to decision makers. Information System Cost & Revenue Determination Job costing Process costing ABC Sales Assets & Liabilities Plant and equipment Loans & equity Receivables, payables & cash Cash Flows From operations From financing From investing Information Users Investors Creditors Managers Owners Customers Employees...
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...accounts. Along with journalizing transactions and adjusting entries, the accounting cycle also involves closing entries and preparing a post-closing trial balance. We believe that the most important of the skills learned when we are in an accounting position is to understand the basic accounting equation, assets + liabilities + stockholder’s equity. Most accounting concepts all go back to this equation as the basis for balancing accounts when transactions are journalized in them. There are two types of accounting methods used to maintain financial records and prepare reports: accrual and cash basis accounting. Accrual basis accounting is the method that is accepted under the Generally Accepted Accounting Principles (GAAP). This principle holds that accounting transactions are recognized and recorded when the expense or revenue actually occurred, not when cash changes hands (James, 2012). The benefit of accrual basis accounting is that expenses and revenues can be matched as they happen, which is much more effective for monitoring cash flow (Epstein, n.d.). Accrual accounting has a more complex recording process than cash basis accounting and can be a disadvantage when it comes time to pay taxes. Because this accounting method requires that expenses and revenue are recorded right away, the taxes must be paid on the recorded revenue; even if it has not been yet been paid (Reference For Business, 2012). Adjusting entries are recorded at the end of every accounting...
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