Professional Documents
Culture Documents
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Advantages:
1. Has the greatest capacity to raise
capital
2. Can raise capital by selling shares of
stock to the public as a whole
3. Shareholders may transfer their shares
without the need to obtain the consent
of other shareholders
4. Corporations may exist for period no
longer than 50 years, subject to
renewal
5. Limited liability of owners
(shareholders are liable to third parties
for the losses of the corporation only to
the limit of their fully-paid
investments)
6. If corporation goes bankrupt, lenders
cannot take personal assets of the
stockholders
Disadvantages:
Economic Decisions
Economic decisions- decisions which affect the
resources it controls and the obligations of the
business to other enterprises
Financial Information- a summary of all the
transactions of the business over a period of
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Is a Filipino citizen
Is of good moral character
Is a holder of degree of Bachelor of
Science in Accountancy conferred by a
school, college, academy or institute duly
recognized and/or accredited by the CHED
or other authorized government offices
Has not been convicted of any criminal
offense involving moral turpitude
Management Services
Business Law and Taxation
Theory of Accounts
Auditing Theory
Auditing Problems
Practical Accounting Problems 1
Practical Accounting Problems 2
Economics
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Fields of Accounting
1. Financial accounting-focuses on
preparation of general-purpose financial
statements with the aim of meeting most
of the needs of the external users
2. Management accounting- concerned
with financial reporting for internal users
(management) and users have control
over the accounting system and can
specify precisely the type of reports
needed for use in decision-making
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3.
4.
Chapter 2
Generally Accepted Accounting Principles
GAAP- comprises the accounting principles and
processes, standards and underlying assumptions
that are used in preparing financial statements
Financial Reporting Standards Council
(FRSC)- official accounting standard setting body
in the Philippines. The primary task of FRSC is to
improve and establish accounting standards that
will be generally accepted in the Philippines
Philippine Financial Reporting Standards
(PFRS)- The FRSC issued this and this
constitutes the generally accepted accounting
standards observed in the Philippines
-PFRS includes:
5.
6.
7.
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Accrual basis
Going concern
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Criteria:
1. It is probable that any future economic
benefit associated with the item will flow
to or from the enterprise
2. The item has cost or value that can be
measured with reliability
Examples:
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Examples:
1. Sales invoice- issued to evidence a sale
for cash
2. Delivery receipt- evidence the
acceptance/receipt of the goods delivered
to the customer
3. Official receipt- issued to evidence the
receipt of cash from customers
4. Vendors invoice- issued to the
enterprise by the enterprises suppliers
5. Purchase requisition forms- evidences
an employees request for the purchase of
needed goods or suppliers
6. IOUs- note acknowledging indebtedness
to the enterprise
7. Promissory notes- unconditional
promise in writing made by one person to
another
8. Bank statements- summary of all
financial transactions occurring over a
certain period on a bank account
9. Minutes of meetings- record of a
meeting
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1. Asset Accounts
Cash- medium of exchange for
business transactions
Held for trading securitiestemporary investments of excess cash
which are primarily held for short-term
gain
Loans and receivables- trade
receivables and non-trade receivables
and are claim against others which
arise in the ordinary course of doing
business
Trade notes receivable- written
promise from the customer to pay a
fixed amount of money on a certain
future date
Non-trade receivables- all other
claims which are not trade
Inventories- assets which are held for
sale/ in the process of production/ in
the form of materials and supplies
Prepaid expenses-expenses paid for
by the business in advance. (e.g.
prepaid insurance and prepaid rent)
Long-term investments- asset held
by an enterprise for the accretion of
wealth through capital distribution for
capital appreciation or for other
benefits to the investing enterprise
Property, plant and equipmenttangible assets used in the production
or supply of goods or services
Intangible assets- identifiable, nonmonetary assets without physical
substance
2. Liability Accounts
Accounts payable- opposite of
accounts receivable
Notes payable- enterprise is the one
who promises to pay
Accrued liabilities- amounts owed to
others for unpaid expenses
Unearned revenues- enterprise
receives payments before providing
its customers with goods or services
Mortgage payable- used for
recording long-term debts of an
enterprise
Bonds payable- large sums of money
are often required by a business for
working capital and expansion
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