会计原理4

2010
1 Adjusting Entries (수정분개 수정분개) 수정분개
Table 4-1
Types of Adjustments
Cash Receipts or Cash Payments Cash First Prepaid Expenses＝Assets ＝ e.g.) Prepaid Insurance Expenses Book Recognition Unearned Revenues e.g.) Unearned Service Fees Revenues Unearned Sales Revenues e.g.) Interest Receivable Rent Receivable Accrued Revenues ＝Accrued Assets Prepaid Rent Office Supplies Cash Later Accrued Expenses ＝Accrued Liabilities e.g.) Salaries Payable Income Taxes Payable Advertising Payable
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Depreciation(감가상각)
Depreciation
• Classic example of an adjusting entry • A form of amortization(allocation of cost over useful life). • Asset with multi-period utility is initially recorded as assets (prepaid expense) on the balance sheet • As asset’s utility is consumed over time, we need to recognize the consumed part as expense (expired cost) by transferring part of the asset (unexpired cost) from the Balance Sheet to the Income Statement.
Depreciation
• Straight Line Depreciation formula • Periodic depreciation expense = (Original Cost – Salvage Value)/(Number of periods)
Depreciation Example
3 Unearned Revenues (선수수익)
Unearned Rent Income(선수임대수익)
EXAMPLE 4.2 Fact: Rent received in advance for a 12 month period on April 1, 20x1 Semi-annual Financial Statements: June 30 and December 31 $1,200 Allocation: April1 April 1 Journal Entry Dr. Cash Cr. June 30 Adjusting Entry Dr. Unearned Rent Income Cr. Rent Income 300 300 1,200 Unearned Rent Income 1,200 $300 June 30 $900 Sep.30
Example 4-5
Lakeside Corporation has the following trial balance as of December 31, 20×1.
Lakeside Corporation Trial Balance December 31, 20×1 × Cash Accounts Receivable Machinery Accounts Payable Capital Stock Retained Earnings Service Revenue Salary Expense Telephone Expense Rent Expense 3,000 1,000 4,000 $29,000 $29,000 $4,000 5,000 12,000 $5,000 10,000 2,000 12,000
Table 4-2
Characteristics of Adjusting ntries
To prepare financial statements properly. That is, to measure assets, For what? liabilities, revenues and expenses correctly. Because financial accounting is based on accrual basis. In other words, Why? there is discrepancy between book recognition of revenues or expenses and cash receipts or payments. When? What types? revenues At the end of each accounting period. prepaid expenses, unearned revenues, accrued expenses and accrued
4 Types of Adjustments
2 Deferrals (Cash First and Recognition Later) : - Prepaid Expenses - Unearned Revenues
2 Accruals (Recognition First and Cash Later): - Accrued Expenses - Accrued Revenues
• A car having a five year life expectancy was acquired on January 1 for $12,000. Estimated salvage value is zero after five years. • Annual depreciation = 12,000/5 = $2,400 • 6 month depreciation expense = $2,400/2 = $1,200 • Journal Entry on June 30. Dr. Depreciation Expense 1,200 Cr. Accumulated Depreciation 1,200 • Book value as of June 30: $12,000 - $1,200 = $10,800
4 Accrued Expenses(발생비용)
Accrued Rent Expense(발생임차료)
EXAMPLE 4.3 Fact: Store rented for a 12 month period on April 1, 20x1. Rent will be paid at the end of the rent period Semi-annual financial statements: June 30 and December 31 ($1,200) Allocation: April1 $300 June 30 $900 March 30
7 Closing entries(마감분개)
Closing Entries
• Temporary accounts(임시계정) are closed out to retained earnings. • Closing means empting the balance. • Income statement accounts are temporary accounts. Balance sheet accounts are permanent accounts(영구계 정). • Income Summary(집합손익) account is used as a vehicle to close out temporary accounts. • First, close all the revenue accounts. • Second, close all the expense accounts. • Third, close Income Summary to Retained Earnings.
Example 4-5
The closing entries on December 31, 20×1 are as follows:
(1) To close revenue Service Revenue Income Summary 12,000 12,000
(2) To close expenses Income Summary 8,000 Salary Expense 3,000 Telephone Expense 1,000 Rent Expense Hale Waihona Puke Baidu,000 (3) To close Income Summary Income Summary 4,000 Retained Earning 4,000 After the closing entries, no income statement accounts exist. The net effect has been to increase retained earnings by $4,000, the profit for the year. Hence, the Retained Earnings has an ending balance of $6,000($2,000＋$4,000). ＋
CHAPTER 4
ADJUSTING AND CLOSING ENTRIES
IFRS Principles of Accounting with Key Words in Korean
Soon Suk Yoon • Hyo Jin Kim
PowerPoint Presentation by: Soon Suk Yoon, Professor, Chonnam National University Hyo Jin Kim, Assistant Professor, Jeonju University
2
Prepaid Expenses(선급비용)
Prepaid Rent(선급보험료)
EXAMPLE 4.1 Fact: Rent paid for a 12 month period on April 1, 20x1 Semi-annual Financial Statements: June 30 and December 31 ($1,200) Allocation: April1 April 1 Journal Entry Dr. Prepaid Rent Cr. June 30 Adjusting Entry Dr. Rent Expense Cr. 300 Prepaid Rent 300 1,200 Cash 1,200 $300 June 30 $900 March 31
April 1 No entry is made. June 30 Adjusting Entry Dr. Rent Expense Cr. 300 Rent Payable 300
5 Accrued Revenues(발생수익)
Accrued Rent Income(발생임대수익)
EXAMPLE 4.4 Fact: Store rented for a 12 month period on April 1, 20x1. Rent will be collected at the end of the rent period Semi-annual financial statements: June 30 and December 31 $1,200 Allocation: April 1 April 1 No entry is made. June 30 Adjusting Entry Dr. Rent Receivable Cr. 300 Rent Income 300 $300 June 30 $900 March 31