Professional Documents
Culture Documents
Financial Accounting
Overview 1
ACCOUNTING IN ACTION
Objectives
1. What is Accounting?
2. The Building Blocks of Accounting
3. The Basic Accounting Equation
4. Using the Accounting Equation
5. Financial Statements
6. The Account
7. Steps in the Recording Process
8. The Recording Process Illustrated
9. The Trial Balance
What is Accounting?
Accounting consist of three activities:
1. identifies,
2. records, and
3. communicates
User of Accounting
Information
Assets:
•Intangible Assets Equity and Liabilities:
•Property, Plant and • Equity
Equipment • Non current liabilities
•Long-term Investment • Current liabilities
•Current Assets
ACCOUNTING FOR
MERCHANDISING OPERATIONS
Objectives
• Identify the differences between merchandising
and service companies.
• Explain the recording of purchases and sales
revenue under a perpetual inventory system.
• Explain the steps in the accounting cycle for a
merchandising company.
• Prepare an income statement for a
merchandising companies.
Merchandising Company
• Buy and sell merchandise
• Revenues called sales revenue or sales
• Expenses: Cost of Goods Sold (COGS) and
Operating Expenses
• COGS: the total cost of merchandise sold
during the period
Merchandising Company
Dr. Inventory