基础会计学英文版参考资料.pptVIP

3 - 31 Links to Financial Statements A 1 31 4/8/2020 3 - 32 P 2 32 4/8/2020 3 - 33 Preparing Financial Statements Lets use FastForwards adjusted trial balance to prepare the companys financial statements. P 3 33 4/8/2020 3 - 1 会 计 学 1 Fundamental Financial Accounting 1 Instructor: Dr. Xiaoyan Lu Email: luxy@mail.sysu.edu.cn Tel:1 2 3 - 2 STUDY OBJECTIVES After studying this chapter, you should understand: Time period assumption Adjusting entries for prepayments Accrual basis of accounting Adjusting entries for accruals Why adjusting entries are necessary Purpose of an adjusted trial balance Major types of adjusting entries Alternate treatment of prepayments accruals CHAPTER 3 Adjusting Accounts and Preparing Financial Statements 2 3 - 3 The Accounting Period C 1 3 4/8/2020 3 - 4 Accounting Accrual Basis versus Cash Basis Accrual Basis Revenues are recognized when earned and expenses are recognized when incurred. Cash Basis Revenues are recognized when cash is received and expenses are recorded when cash is paid. C 2 4 4/8/2020 3 - 5 Cash Basis Revenues are recognized when cash is received and expenses are recorded when cash is paid. Accounting Accrual Basis versus Cash Basis Non-GAAP C 2 Accrual Basis Revenues are recognized when earned and expenses are recognized when incurred. 5 4/8/2020 3 - 6 Accrual Basis versus Cash Basis On December 1, 2013, FastForward paid $2,400 cash for a twenty-four month business insurance policy. Using the cash basis , the entire $2,400 would be recognized as insurance expense in 2013. No insurance expense from this policy would be recognized in 2014 or 2015, periods covered by the policy. C 2 6 4/8/2020 3 - 7 Accrual Basis versus Cash Basis On the accrual basis, $100 of insurance expense is recognized in 2013, $1,200 in 2014, and $1,100 in 2015. The expense is matched with the periods benefited by the insurance coverage. C 2 7 4/8/2020 3 - 8 We have delivered the product to our custome