Intermediate Accounting ch03.ppt

LO 9 Identifying adjusting entries that may be reversed. Illustration of Reversing Entries—Accruals Illustration 3B-1 APPENDIX 3B USING REVERSING ENTRIES LO 9 Identifying adjusting entries that may be reversed. Illustration of Reversing Entries—Deferrals APPENDIX 3B USING REVERSING ENTRIES Illustration 3B-2 LO 9 Identifying adjusting entries that may be reversed. Summary of Reversing Entries All accruals should be reversed. All deferrals for which a company debited or credited the original cash transaction to an expense or revenue account should be reversed. Adjusting entries for depreciation and bad debts are not reversed. Recognize that reversing entries do not have to be used. Therefore, some accountants avoid them entirely. APPENDIX 3B USING REVERSING ENTRIES LO 10 Prepare a 10-column worksheet. A company prepares a worksheet either on columnar paper or within an electronic spreadsheet. A company uses the worksheet to adjust account balances and to prepare financial statements. APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED LO 10 Prepare a 10-column worksheet. A company prepares a worksheet either on columnar paper or within an electronic spreadsheet. Worksheet Columns APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED LO 10 Illustration 3C-1 Worksheet APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED The Worksheet: provides information needed for preparation of the financial statements. Sorts data into appropriate columns, which facilitates the preparation of the statements. LO 10 Prepare a 10-column worksheet. Preparing Financial Statements from a Worksheet APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED LO 10 Illustration 3-39 APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED Illustration 3-40 APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED LO 10 Illustration 3-41 APPENDIX 3C USING A WORKSHEET: THE ACCOUNTING CYCLE REVISITED LO 10 RELEVANT FACTS International companie