Lecture 9 - Student 2pp

Lecture 9 - Student 2pp - Accounting Information Systems...

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Accounting Information Systems Developed by John Wiley Ltd Adapted by Abdul Razeed Chapter 8 Accounting 1A | ACCT 1001 2 Outline Review the basic principles of Accounting Information Systems Explain the purpose of accounting subsystems: - Special Journals - Sales Journal - Purchases Journal - Cash Receipts Journal - Cash Payments Journal - Subsidiary Ledgers - Accounts Receivable (AR Control Account) - Accounts Payable (AP Control Account) Demonstrate ability to record transactions in special journals and correctly post entries to general and subsidiary ledgers Demonstrate the ability to reconcile subsidiary ledger to control accounts
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3 Review-Week 7 1. Inventory Overview 2. Account for inventory by the Specific Identification, FIFO, LIFO and average cost methods using Periodic and Perpetual Inventory Systems. 3. Compare the effects of FIFO, LIFO and average cost. 4. Apply accounting principles to inventory measurement and disclosure. 5. Measure the effects of inventory errors. 4 The Accounting Cycle 2. Journalise transactions 3. Post to ledger accounts 4. Prepare trial balance of GL 6. Prepare financial statements Source documents General Ledger Trial Balance General Journal and Ledger Financial Statements Steps in the cycle Accounting Records
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5 Special Journals Special journals achieve a number of advantages over just using General Journal, such as: - Processing efficiency - Lower processing costs - Greater data accuracy and control - Task separation and specialisation improves document and work flow efficiency - Flexibilit y & adaptability to the type of business eg. can have columns for major types of payments or receipts, GST collected/paid. 6 Special Journals Sales Journal (S) All sales of inventory on account ie, on credit Purchases Journal (P) All purchases on account ie, on credit Cash Receipts Journal (CR ) All cash received (eg. cash sales, receipts from receivables, other) Cash Payments Journal (CP ) All cash paid (eg. cash purchases, payments to payables, wages etc.) General Journal (J) Transactions that cannot be entered in a special journal (eg. correcting, adjusting and closing entries).
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7 Subsidiary ledgers are groups of accounts with a common characteristic. The control account provides a summary of the details in the subsidiary ledgers. 8 Accounts Receivable Control Account Collects detailed transaction data of individual customers Accounts Payable Control Account Collects detailed transaction data of individual creditors Fixed Assets Collects details about non-current assets such as buildings, furniture, equipment, motor vehicles Inventory Collects details about the various inventories held by a business These are some example of control accounts (it is not an exhaustive list):
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9 The total of the accounts in the subsidiary ledger must
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This note was uploaded on 08/18/2011 for the course ACCT 1001 taught by Professor Luder during the Three '08 term at University of Sydney.

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Lecture 9 - Student 2pp - Accounting Information Systems...

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