专业英文讲解Chap004.ppt

Adjusting Entries Types of Adjusting Entries Converting Assets to Expenses Converting Assets to Expenses Converting Assets to Expenses Converting Assets to Expenses Converting Assets to Expenses Converting Assets to Expenses The Concept of Depreciation The Concept of Depreciation The portion of an asset’s utility that is used up must be expensed in the period used. Depreciation Is Only an Estimate On May 2, 2005, JJ’s Lawn Care Service purchased a lawn mower with a useful life of 50 months for $2,500 cash. Using the straight-line method, calculate the monthly depreciation expense. Depreciation Is Only an Estimate Depreciation Is Only an Estimate Converting Liabilities to Revenue Converting Liabilities to Revenue Converting Liabilities to Revenue Converting Liabilities to Revenue Converting Liabilities to Revenue Converting Liabilities to Revenue Accruing Unpaid Expenses Accruing Unpaid Expenses Accruing Unpaid Expenses Accruing Unpaid Expenses Accruing Unpaid Expenses Accruing Unpaid Expenses Accruing Unpaid Expenses Accruing Uncollected Revenue Accruing Uncollected Revenue Accruing Uncollected Revenue Accruing Uncollected Revenue Accruing Uncollected Revenue Accruing Uncollected Revenue Accruing Uncollected Revenue Accruing Income Taxes Expense: The Final Adjusting Entry Adjusting Entries and Accounting Principles The Concept of Materiality Adjusted Trial Balance End of Chapter 4 4 4 4 4 4 Saturday, Jan. 15 Tuesday, Feb. 15 $170 Interest Revenue On Jan. 31, the bank owes Webb Co. interest of $170. Interest is paid on the 15th day of each month. Monday, Jan. 31 Initially, the revenue is recognized and a receivable is created. Income Statement Revenue earned this period. Balance Sheet Receivable to be collected in a future period. Saturday, Jan. 15 Tuesday, Feb. 15 $320 Monthly Interest $170 Interest Revenue Let’s look at the entry for February 15. Monday, Jan. 31 $150 Interest Revenue The receivable is collected in a future period. As a corporation earns taxab