By Jerry J. Weygandt
Weygandt's Accounting rules introduces demanding accounting ideas with examples which are normal to accountants. the hot version has been up to date with the most recent IFRS/IASB criteria. extra insurance is integrated on foreign currency echange translation and LCM. extra discussions concentrate on chance administration as a result monetary main issue. The examples additionally emphasize present examples with a purpose to aid accountants make the relationship to their daily lives.
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Additional info for Accounting Principles, 10th Edition
Exp. Ser. Rev. 2600 Rent Exp. /Wages Exp. 2200 Utilities Exp. 2250 2600 2$1,300 $1,400 1 $1,600 1 $7,000 ⎧ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎨ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎩ $ 8,050 1 Rev. 1 $15,000 $18,050 Illustration 1-8 Tabular summary of Softbyte transactions 5 $1,600 1 $15,000 2 $1,300 1 Drawings $4,700 2 $1,950 ⎧ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎨ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎩ Cash 5 Liabilities 1 Accounts Accounts Owner’s Owner’s 1 Receivable 1 Supplies 1 Equipment 5 Payable 1 Capital 2 Drawings 1 $18,050 Illustration 1-8 demonstrates some significant facts: 1.
Utilities Exp. 9/ch05 Using the Accounting Equation 19 The two sides of the equation now balance at $19,600. Three lines in the analysis indicate the different types of expenses that have been incurred. Transaction (8). Payment of Accounts Payable. Softbyte pays its $250 Daily News bill in cash. The company previously [in Transaction (5)] recorded the bill as an increase in Accounts Payable and a decrease in owner’s equity. Basic Analysis This cash payment “on account” decreases the asset Cash by $250 and also decreases the liability Accounts Payable by $250.
To illustrate, Sally Rider, owner of Sally’s Boutique, must keep her personal Ethics Note living costs separate from the expenses of the Boutique. Similarly, McDonald’s, Coca-Cola, and Cadbury-Schweppes are segregated into separate economic The importance of the economic entities for accounting purposes. entity assumption is illustrated by scandals involving Adelphia. In this case, senior company employees entered into transactions that blurred the line between the employees’ financial interests and those of the company.