CLASSIFICATION ACCOUNT AND PRESENTATION
Account Title
Accounts Payable Accounts Receivable Accumulated Depreciation--Buildings Administrative Expenses Allowance for Doubtful Accounts Amortization Expense Bad Debts Expense Bonds Payable Buildings Cash Common Stock Copyright Cost of Goods Sold Depreciation Expense Discount on Bonds Payable Dividends Dividends Payable Equipment Freight-out Gain on Disposal of Plant Assets Goodwill Income Summary Income Tax Expense Income Taxes Payable Insurance Expense Interest Expense Interest Payable Interest Receivable Interest Revenue Inventory
Classification A
Current Liability Current Asset Plant Asset--Contra Operating Expense Current Asset--Contra Operating Expense
Financial Statement
Balance Sheet Balance Sheet Balance Sheet Balance Sheet Income Statement Balance Sheet Income Statement Income Statement Balance Sheet Balance Sheet
Normal Balance
Credit Debit Credit Credit Debit Credit Debit Debit Credit Debit Debit Credit Debit Debit Debit Debit Debit Credit Debit Debit Credit Debit (1) Debit Credit Debit Debit Credit Debit Credit Debit
Accumulated Depreciation--Equipment Plant Asset--Contra
B
Operating Expense Long-Term Liability Plant Assets
C
Current Asset Stockholder's Equity Intangible Asset Cost of Goods Sold Balance Sheet Balance Sheet Balance Sheet Income Statement Income Statement Balance Sheet Retained Earnings Statement Balance Sheet Balance Sheet
D
Operating Expense Long-Term Liability--Contra Temporary account closed to Retained Earnings Current Liability
E
Plant Asset
F
Operating Expense Income Statement Income Statement Balance Sheet Not Applicable Income Statement Balance Sheet Income Statement Income Statement Balance Sheet Balance Sheet Income Statement Balance Sheet (2)
G
Other Income Intangible Asset
I
Temporary account closed to Retained Earnings Income Tax Expense Current Liability Operating Expense Other Expense Current Liability Current Asset Other Income Current Asset
EP-1
Account Title
Land Loss on Disposal of Plant Assets Maintenance and Repairs Expense Mortgage Payable Notes Payable
Classification L
Plant Asset Other Expense
Financial Statement
Balance Sheet Income Statement
Normal Balance
Debit Debit Debit Credit Credit
M
Operating Expense Long-Term Liability Income Statement Balance Sheet Balance Sheet
N
Current Liability/ Long-Term Liability
P
Patent Paid-in Capital in Excess of Par Value--Common Stock Paid-in Capital in Excess of Par Value--Preferred Stock Preferred Stock Premium on Bonds Payable Prepaid Insurance Prepaid Rent Rent Expense Retained Earnings Intangible Asset Stockholders' Equity Stockholders' Equity Stockholders' Equity Long-Term Liability--Contra Current Asset Current Asset Balance Sheet Balance Sheet Balance Sheet Balance Sheet Balance Sheet Balance Sheet Balance Sheet Debit Credit Credit Credit Credit Debit Debit Debit Credit
R
Operating Expense Stockholders' Income Equity Statement Balance Sheet and Retained Earnings Statement Income Statement Balance Sheet Income Statement Income Statement Income Statement Income Statement Income Statement Balance Sheet Balance Sheet Income Statement Balance Sheet Balance Sheet Income Statement
S
Salaries and Wages Expense Salaries and Wages Payable Sales Discounts Sales Returns and Allowances Sales Revenue Selling Expenses Service Revenue Short-Term Investments Supplies Supplies Expense Treasury Stock--Common Unearned Service Revenue Utilities Expense Operating Expense Current Liability Revenue--Contra Revenue--Contra Revenue Operating Expense Revenue Current Asset Current Asset Operating Expense Debit Credit Debit Debit Credit Debit Credit Debit Debit Debit Debit Credit Debit
T
Stockholders' Equity
U
Current Liability Operating Expense
(1) The normal balance for Income Summary will be credit when there is a net income, debit when there is a net loss. The Income Summary account does not appear on any financial statement. (2) If a periodic system is used, Inventory also appears on the income statement in the calculation of cost of goods sold.
EP-2
The following is a sample chart of accounts. It does not represent a comprehensive chart of all the accounts used in this textbook but rather those accounts that are commonly used. This sample chart of accounts is for a company that generates both service revenue as well as sales revenue. It uses the perpetual approach to inventory. If a periodic system was used, the following temporary accounts would be needed to record inventory purchases: Purchases; Freight-in; Purchase Returns and Allowances; and Purchase Discounts.
CHART OF ACCOUNTS
Assets
Cash Accounts Receivable Allowance for Doubtful Accounts Interest Receivable Inventory Supplies Prepaid Insurance Bonds Payable Prepaid Rent Land Equipment Accumulated Depreciation-- Equipment Buildings Accumulated Depreciation-- Buildings Copyright Supplies Expense Goodwill Utilities Expense Patent Discount on Bonds Payable Premium on Bonds Payable Mortgage Payable Dividends Interest Expense Income Summary Loss on Disposal of Plant Assets Maintenance and Repairs Expense Rent Expense Salaries and Wages Expense Selling Expenses Retained Earnings Insurance Expense
Liabilities
Notes Payable Accounts Payable Unearned Service Revenue Salaries and Wages Payable Interest Payable Dividends Payable Income Taxes Payable
Stockholders' Equity
Common Stock Paid-in Capital in Excess of Par Value--Common Stock Preferred Stock Paid-in Capital in Excess of Par Value--Preferred Stock Treasury Stock-- Common
Revenues
Service Revenue Sales Revenue Sales Discounts Sales Returns and Allowances Interest Revenue Gain on Disposal of Plant Assets
Expenses
Administrative Expenses Amortization Expense Bad Debts Expense Cost of Goods Sold Depreciation Expense Freight-out Income Tax Expense
EP-3