AFM291-ch03

AFM291-ch03 - TheAccountingInformationSystem Chapter 3 AFM...

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AFM 291 chapter 3 1     Chapter 3 Chapter 3         The Accounting Information System The Accounting Information System
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AFM 291 chapter 3 2 The Accounting Information The Accounting Information System System Accounting Accounting Information System Information System •Basic terminology •Debits and credits •Accounting equation •Financial statements and ownership structure Using a Using a Worksheet Worksheet •Adjustments entered •Work sheet columns •Preparing financial statements from a work sheet •Closing entries •Monthly statements, yearly closing Accounting Cycle •Identifying and recording •Journalizing •Posting •Trial balance Adjusting entries Adjusted trial balance Closing •Post-closing trial balance Reversing entries •The accounting cycle Appendix 3A- Appendix 3A- Using Using Reversing Reversing Entries Entries •Accruals •Prepayments Summary of reversing entries
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AFM 291 chapter 3 3 AFM 291 - W1 3 The Accounting Equation Assets t = Liabilities t + Common Shares t + Retained Earnings t Assets t = Liabilities t + Shareholders’ Equity t Change in Retained Earnings t – t-1 = Revenues t – Expenses t – Dividends t Assets t = Liabilities t + Common Shares t + Accumulation of (Revenues – Expenses – Dividends) period 1 to t
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AFM 291 chapter 3 4 The Accounting Cycle: Steps The Accounting Cycle: Steps Analyse the transaction Journalize the transaction Post the transaction to general ledger (and sub-ledgers) accounts Prepare the (unadjusted) trial balance Prepare necessary adjusting journal entries
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This note was uploaded on 12/10/2010 for the course AFM 291 taught by Professor Clark during the Spring '10 term at Waterloo.

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AFM291-ch03 - TheAccountingInformationSystem Chapter 3 AFM...

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