会计学英语电子版课件04.ppt

Chapter 4Accrual Accounting Concepts Explain the revenue recognition principle and the matching principle. Differentiate between the cash basis and the accrual basis of accounting. Explain why adjusting entries are needed and identify the major types of adjusting entries. Prepare adjusting entries for prepayments. Chapter 4Accrual Accounting Concepts Prepare adjusting entries for accruals. Describe the nature and purpose of the adjusted trial balance. Explain the purpose of closing entries. Describe the required steps in the accounting cycle. Time Period Assumption... Time Period Assumption... Revenue Recognition Principle... Dictates that revenue be recognized in the accounting period in which it is earned. Is considered earned when the service has been provided or when the goods are delivered. Matching Principle... Requires that expenses be recorded in the same period in which the revenues they helped produce are recorded. Review Review Review Review Review Review Cash Basis Accrual Basis Accounting Accrual Basis adheres to... Types of Adjusting Entries Prepayments: Prepaid expenses: Expenses paid in cash and recorded as assets before they are used or consumed. Unearned Revenues: Cash received and recorded as liabilities before revenue is earned. Accruals: Accrued revenues: Revenues earned but not yet received in cash or recorded. Accrued expenses: Expenses incurred but not yet paid in cash or recorded. Prepaid Expenses Balance Sheet Presentation Accrued Revenues Accrued Expenses Adjusted Trial Balance Closing the Books Close Temporary Accounts Only The Accounting Cycle Required Steps in the Accounting Cycle Review Review Review Review Review Review Which account will have a zero balance after closing entries? Service Revenue Advertising Supplies Prepaid Insurance Accumulated Depreciation Which types of accounts will appear in the post-closing trial balance? Temporary accounts Accounts shown in the income statement Permanent accounts All o