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refers to cash and other assets that are easily converted into cash or consumed during the accounting period usually one year?
current assets
is a money on hand, or in banks, and other items considered as medium of exchange in business transactions
are amounts due from the customers arising from credit sales or credit services.
ACCOUNTS RECEIVABLE
are items purchased by an enterprise which are unused as of the date of reporting date.
BASIC ELEMENTS OF ACCOUNTING
ASSETS, LIABILITIES, OWNER’S EQUITY, INCOME, EXPENSES
ACCOUNTING EQUATION
ASSETS= LIABILITIES + OWNER'S EQUITY
ARE PROPERTIES OR RIGHTS OR PROPERTY OWNED BY THE BUSINESS. IN OTHER WORDS, ANYTHING OF VALUE OWNED BY THE BUSINESS.
ASSETS
REFERS TO THE OBLIGATIONS OF THE COMPANY OR ORGANIZATION
LIABILITIES
IS A GENERAL TERM THAT MEANS ANY EARNINGS MADE BY THE BUSINESS.
INCOME
IS THE MONEY SPENT OR COST INCURRED IN AN ENTITY’S EFFORT TO GENERATE REVENUE.
EXPENSES
Are expenses paid in advance.
PREPAID EXPENSE
are obligations or debts of the business which will be paid during the accounting period by means of payment of current assets or a creation of another current liability.
what are the 2 types of accounting period?
calendar and fiscal year.
are expenses that are incurred but not yet paid.
WHAT IS UNEARNED INCOME?
cash collected in advance in which service to be performed or goods to be delivered in the future.
What is adjusting entries?
Entries made at the end of the accounting period before closing procedures to update balances of asset, liability, revenue, and expense accounts to make their balances ready for the preparation of financial statements.
What is the adjusting entry of Accrued Revenue?
Receivable xxxxx
Revenue xxxxx
What is the adjusting entry of Accrued Expense?
Expense xxxx
Payable xxxx
What is the adjusting entry of unearned revenue using unearned revenue while using LIABILITY METHOD.
UNEARNED REVENUE XXXX
SERVICE REVENUE XXXX
What is the adjusting entry of unearned revenue using unearned revenue while using INCOME METHOD.
UNEARNED SERVICE REVENUE XXXXXXXXXX