Financial accounting chapter 01 accounting in action

Kế toán tài chính chương 01 Những Hoạt động trong kế toán tài chính Financial Accounting Chapter 01 Accounting in action International financial Report Standard. Tiêu chuẩn kế toán tài chính quốc tế.

1-1 Preview of Chapter 1 Financial Accounting IFRS Second Edition Weygandt Kimmel Kieso 1-2 Chapter 1 Accounting in Action Learning Objectives After studying this chapter, you should be able to: 1. Explain what accounting is. 2. Identify the users and uses of accounting. 3. Understand why ethics is a fundamental business concept. 4. Explain accounting standards and the measurement principles. 5. Explain the monetary unit assumption and the economic entity assumption. 6. State the accounting equation, and define its components. 7. Analyze the effects of business transactions on the accounting equation. 8. Understand the four financial statements and how they are prepared. 1-3 LO 1 Explain what accounting is. Accounting consists of three basic activities - it  identifies,  records, and  communicates the economic events of an organization to interested users. What is Accounting? 1-4 Three Activities Illustration 1-1 The activities of the accounting process The accounting process includes the bookkeeping function. What is Accounting? LO 1 Explain what accounting is. 1-5 ( 단위 : 억원 ) 재무상태표 2009.06.30 2010.06.30 2010.12.31 2011.03.31 자 산 29,653 36,540 38,452 38,325 부 채 27,585 34,206 36,047 36,197 자 본 2,067 2,334 2,405 2,127 손익계산서 08.7.1-09.6.30 09.7.1-10.6.30 10.7.1-10.12.31 10.7.1-11.3.31 영업수익 3,136 3,068 1,678 2,521 영업비용 (2,661) (2,936) (1,619) (2,635) 영업손익 474 132 58 -114 당기순손익 308 147 66 -196 현금흐름표 08.7.1-09.6.30 09.7.1-10.6.30 10.7.1-10.12.31 10.7.1-11.3.31 영업활동 -3,865 -6,748 -2,332 -2,542 투자활동 -4,816 -6 -23 -87 재무활동 4,019 6,887 1,751 1,901 1-6 1-7 Management Human Resources Taxing Authorities Labor Unions Regulatory Agencies Marketing Finance Investors Creditors Customers Internal Users External Users Who Uses Accounting Data LO 2 Identify the users and uses of accounting. Information Why ? 1-8 International Financial Reporting Standards (IFRS) LO 4 Explain accounting standards and the measurement principles. Financial Accounting Standards Board (FASB) http://www.fasb.org/ International Accounting Standards Board (IASB) http://www.iasb.org/ Generally Accepted Accounting Principles (GAAP) The Building Blocks of Accounting Accounting Standards 2011year 1-9 Cost Principle – or historical cost principle, dictates that companies record assets at their cost. Fair Value Principle – states that assets and liabilities should be reported at fair value (the price received to sell an asset or settle a liability). Measurement Principles The Building Blocks of Accounting LO 4 Explain accounting standards and the measurement principles. 1-10 Team Quiz #1 1) The hiring of a new company president is an economic event recorded by the financial information system. F 2) Management of a business enterprise is the major external user of information. F 3) Bookkeeping and accounting are one and the same because the bookkeeping function includes the accounting process. F 4) International Financial Reporting Standards are determined by the IASB. T 5) IFRS follows one measurement principle known as the historical cost principle. F [...]... the financial position (assets, liabilities, or equity) of the company changed? Record/ Don’t Record 1-21 LO 7 Analyze the effects of business transactions on the accounting equation Using the Accounting Equation Transaction Analysis Illustration 1-9 Expanded accounting equation 1-22 LO 7 Analyze the effects of business transactions on the accounting equation Team Quiz #2 1) Expenses are increases in. .. Transactions are a business’s economic events recorded by accountants   Not all activities represent transactions  1-20 May be external or internal Each transaction has a dual effect on the accounting equation LO 7 Analyze the effects of business transactions on the accounting equation Using the Accounting Equation Illustration: Are the following events recorded in the accounting records? Event Criterion... the accounting equation, and define its components The Basic Accounting Equation Assets = Liabilities + Equity Provides the underlying framework for recording and summarizing economic events Equity   Referred to as residual equity  1-14 Ownership claim on total assets Share capital-ordinary and retained earnings LO 6 State the accounting equation, and define its components The Basic Accounting. .. Revenues result from business activities entered into for the purpose of earning income Generally results from selling merchandise, performing services, renting property, and lending money 1-15 LO 6 State the accounting equation, and define its components The Basic Accounting Equation Illustration 1-7 Expenses are the cost of assets consumed or services used in the process of earning revenue Common expenses... Assets Total Liabilities 2012 $530,000 $230,000 2013 $480,000 $210,000 From an analysis of the change in equity during the year, compute the net income (or loss) for: (a) 2012 , assuming Lim paid dividends of $25,000 for the year (b) 2013 , assuming Lim made an additional investment of $60,000 and paid no dividends in 2013 1-24 Team Quiz #2 1-25 Transaction Analysis Transaction (1) Investment by Shareholders... Then indicate whether each item increases or decreases equity Classification Effect on Equity 1 Rent expense Expense Decrease 2 Service revenue Revenue Increase Equity Decrease Expense Decrease 3 Dividends 4 Salaries expense 1-18 LO 6 State the accounting equation, and define its components 1-19 LO 6 State the accounting equation, and define its components Using the Accounting Equation Transactions...The Basic Accounting Equation Assets = Liabilities + Equity Provides the underlying framework for recording and summarizing economic events Applies to all economic entities regardless of size 1-11 LO 6 State the accounting equation, and define its components The Basic Accounting Equation Assets = Liabilities + Equity Provides the underlying framework for recording and summarizing economic events... expense, rent expense, interest expense, property tax expense, etc 1-16 LO 6 State the accounting equation, and define its components The Basic Accounting Equation Illustration 1-7 Dividends are the distribution of cash or other assets to shareholders   1-17 Reduce retained earnings Not an expense LO 6 State the accounting equation, and define its components Classify the following items as issuance... services or benefits  1-12 Resources a business owns Cash, Inventory, Equipment, etc LO 6 State the accounting equation, and define its components The Basic Accounting Equation Assets = Liabilities + Equity Provides the underlying framework for recording and summarizing economic events Liabilities   Creditors - party to whom money is owed  1-13 Claims against assets (debts and obligations) Accounts... beginning of 2014 , Bonds Company had total assets of $650,000 and total liabilities of $370,000 If total assets increased $60,000 and equity decreased $90,000 during the year, determine the amount of total liabilities at the end of the year Ending Total Liabilities = ($650,000 + $60,000) – ($650,000 – $370,000 $90,000) = $710,000 – $190,000 = $520,000 8) Lim began business on Jan 1, 2012 , with an investment . uses of accounting. Information Why ? 1-8 International Financial Reporting Standards (IFRS) LO 4 Explain accounting standards and the measurement principles. Financial Accounting Standards Board. Chapter 1 Financial Accounting IFRS Second Edition Weygandt Kimmel Kieso 1-2 Chapter 1 Accounting in Action Learning Objectives After studying this chapter, you should be able to: 1. Explain what. function includes the accounting process. F 4) International Financial Reporting Standards are determined by the IASB. T 5) IFRS follows one measurement principle known as the historical cost principle.