fa1 chapter3 (财务会计).pptVIP

Topic 3 Matching Concept and Adjusting Process 1. The Matching Concept 2. Nature of the Adjusting Process 3. Recording Adjusting Entries 4. Summary of Adjustment Process Cash Basis of Accounting Accrual Basis of Accounting Revenue reported when cash is received Expense reported when cash is paid Does not properly match revenues and expenses Revenue reported when earned Expense reported when incurred Properly matches revenues and expenses in determining net income Requires adjusting entries at end of period Nature of the Adjusting Process Adjusting entry is the entry that brings the accounts u