MAN 201 CHAPTER 4 V1 - 2020.pdf - 4 Accounting Cycle II...

This preview shows page 1 - 12 out of 44 pages.

4AccountingCycle II(End ofAccountingPeriodTransactions)©2017ÇankayaUniversity - MAN 201 Principles of Accounting IAssoc. Prof. CanÖZTÜRKTurkish GAAP
Accounting CycleRecord end ofaccountingperiodtransactionsand preparetrial balanceClosetheaccountsandprepare trialbalancePrepare thefinancialstatements
When do we need end of accountingperiod transactions?PrepaymentsAccruals1.Allocation of costsbetween accountingperiods(Prepaid Expenses)3.Expenses incurred but notrecorded2.Allocation of unearnedrevenues betweenaccounting periods4.Revenues earned but notrecorded
Turkish Uniform Chart of Cost Accounts (7/A)710 Direct Materials Costs720 Direct Labor Costs730 Manufacturing OverheadIndirect Manufacturing Costs740 Service Costs750 Research and Development Expenses (Costs)760 Marketing, Selling and Delivery Expenses770 General Administrative Expenses780 Financing ExpensesAccounts to determinethe cost of a productmanufacturedAccountsforPeriodCosts
Unadjusted Trial BalanceAccountsDebitsCreditsBanks102.280Accounts Receivable7.500Receivables from Owners3.000Materials Inventory2.500Prepaid Expenses720Furniture and Fixtures15.000Bank Loan15.000Accounts Payable5.000Unearned Revenues7.500Capital100.000Domestic Sales12.500General Administrative Expenses9.000Total140.000 TL140.000 TLExpress Travel AgencyUnadjusted Trial Balance31 January 2014Case A:Express Travel Agency(ETA)The Company closes its accountsmonthly
100.0006005.0005.0002.50060012015.0005.0007.5002.5006001207.5001205.0002.50012.5005.0005.0007.5009.0003.000Funiture & Fixt127.50025.22015.000102.28015.00015.0005.00010.000-5.00015.000Receivables from Owners7.5003.0007.500-100.0003.000100.0005.0009.0007.50012.500-9.000Fin ExpenseCapitalGeneral Admin ExpBank LoansAccounts PayablePrepaid Exp (Insurance)Payables to EmployeesUnearned RevenuesAccumulated Deprec.Prepaid Exp (Rent)Domestic SalesBanksAccounts ReceivableMaterials InventoryREMINDER !!!
End of Accounting Period TransactionsPrepaymentsAccruals1.Allocation of costsbetween accountingperiods3.Expenses incurred but notrecorded2.Allocation of unearnedrevenues betweenaccounting periods4.Revenues earned but notrecorded
Transaction (1)Prepaid Expenses (Rent)Prepaid ExpensesPrepaid Expenses770 General Administrative ExpensesCURRENT TRANSACTION600 / 3 = 200 TLREMINDER !!!Banks
Transaction (1)Prepaid Expenses (Rent)Prepaid Expenses(Rent)01.Oca60031.Oca200Balance400First month rent is accrued at the end of January.OfficeBuilding is used for business operations.Office Building Rent isrecorded toGeneral Administrative Expensesfrom PrepaidExpensesat the end of the monthly accounting period.General Administrative Expenses24.Oca900031.Oca2009200
Transaction(2)Prepaid Expenses(Insurance)CURRENT TRANSACTION120 / 12 = 10 TLPrepaid ExpensesPrepaid Expenses770 General Administrative ExpensesREMINDER !!!Banks
Transaction(2)Prepaid Expenses(Insurance)03.Oca12031.Oca10Balance110Prepaid Expenses(Insurance)First month insurance is accrued at the end of January.OfficeBuildingandEquipmentisusedforbusinessoperations.

Upload your study docs or become a

Course Hero member to access this document

Upload your study docs or become a

Course Hero member to access this document

End of preview. Want to read all 44 pages?

Upload your study docs or become a

Course Hero member to access this document

Term
Winter
Professor
NoProfessor
Tags
Depreciation, Expense, Generally Accepted Accounting Principles, Double entry bookkeeping system, Accounting software

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture