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INTRODUCTION TO ___________________ Accounting Information ___________________
ACCOUNTING ___________________ The Accounting System: Flow of Information ___________________
CONCEPTS
Accounting
___________________ ___________________
___________________ People make decisions ___________________
Defined as the art of recording, classifying,
summarizing, interpreting, measuring, ad
communicating the results of economic activities,
___________________ ___________________
in a significant manner, and in terms or money,
transactions of a financial character and
interpreting the results thereof.
___________________ Business transactions occur ___________________
___________________ ___________________
___________________ Accountants prepare
reports to show the
___________________
The basic objective of accounting is to provide
___________________ results of
business operations ___________________
decision makers with information valuable in
making economic decisions. ___________________ ___________________
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Nature of Business ___________________ Accounting Information ___________________
Types of Business Organizations ___________________ Users of Accounting Information ___________________
o Individuals
o Manufacturing Business ___________________ o Businesses
___________________
o Merchandising Business
___________________ o Investors and Creditors
___________________
o Service Business

Forms of Business Organizations


___________________ o Government Regulatory Agencies ___________________
o Sole Proprietorship
___________________ o Taxing Authorities ___________________
o Partnership ___________________ o Non-profit Organizations
___________________
Other Users
 General Partnership
___________________ o

Types of Accounting Information


___________________
 Limited Partnership

o Corporation
___________________ o Financial Accounting
___________________
Management Accounting
o Cooperatives ___________________ o

o Tax Accounting
___________________
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Accounting Equation ___________________ Accounting Equation ___________________
Assets = Equities
___________________ Sample Problem:
___________________
Type of Owners
___________________ Assets Liabilities Owner's Equity Equity Transaction ___________________
= + Martin Lim, Capital
___________________ Cash ___________________
___________________ + 500,000 + 500,000 Owner Investment ___________________
Liabilities Owner’s Equity
___________________ Type of Owners ___________________
Assets Liabilities Owner's Equity Equity Transaction
___________________ Cash + Land = + Martin Lim, Capital ___________________
Assets = Liabilities + Owner’s Equity
___________________ + 5,000,000 + 5,000,000 Owner Investment ___________________
___________________ - 1,500,000 + 1,500,000
3,500,000 1,500,000 + 5,000,000
___________________
___________________ 5,000,000 5,000,000
___________________
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Accounting Equation ___________________ Basic Financial Statements ___________________
___________________ Sample Financial Statements
___________________
Increase Decrease
___________________ JOYLAND TRAVEL AGENCY
Balance Sheet ___________________
Investment by
the owner
Withdrawals by
the owner
___________________ Month Ended September 30, 2006
___________________
Assets Liabilities and Owner's Equity
___________________ ___________________
Cash …………………….. P 225,000 Liabilities:
Owner’s ___________________ Notes Receivable 100,000 Notes Payable ……… P 410,000 ___________________
Equity Accounts Receivable ….. 605,000 Accounts Payable…..
___________________ Supplies ………………… 20,000 Salaries Payable…….
360,000
30,000 ___________________
Revenues Expenses
___________________ Land……………………… 1,000,000 Total Liabilities 800,000
___________________
Building………………….. 900,000 Owner's Equity
___________________ Office Equipment……….. 150,000 Joy Santos, capital… 2,200,000 ___________________
___________________ Total P 3,000,000 Total P 3,000,000
___________________
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Basic Financial Statements ___________________ Basic Financial Statements ___________________
Sample Financial Statements
___________________ Sample Financial Statements
JOYLAND TRAVEL AGENCY
Income Statement
___________________
___________________ ___________________
Month Ended September 30, 2006

JOYLAND TRAVEL AGENCY Revenues:


Service revenue ……………………… P 85,000
Income Statement Expenses:

Month Ended September 30, 2006 ___________________ Salary Expense………………………


Utilities Expense…………………….
Administrative Expenses……………
Total Expenses……………………….
P 12,000
11,000
4,000
27,000
___________________
___________________ Net Income
JOYLAND TRAVEL AGENCY
Statement of Owner's Equity
P 58,000

___________________
Revenues: Month Ended September 30, 2006

Service revenue ……………………… P 85,000 ___________________ Joy Santos, capital, September 1, 2006…….
Add: Investments by owner …………………..
Net income for the month……………….
P 1,663,000
500,000
58,000
___________________
Expenses: ___________________ Less: Withdrawals by owner …………………
Joy Santos, capital, September 30, 2006 P
2,221,000
21,000
2,200,000
___________________
Salary Expense……………………… P 12,000
___________________ ___________________
JOYLAND TRAVEL AGENCY
Balance Sheet

Utilities Expense……………………. 11,000 Assets


Month Ended September 30, 2006

Liabilities and Owner's Equity

Administrative Expenses…………… 4,000 ___________________ Cash …………………….. P


Notes Receivable
225,000
100,000
Liabilities:
Notes Payable ……… P 410,000 ___________________
Total Expenses………………………. 27,000 Accounts Receivable ….. 605,000 Accounts Payable….. 360,000

___________________ ___________________
Supplies ………………… 20,000 Salaries Payable……. 30,000
Land……………………… 1,000,000 Total Liabilities 800,000
Net Income P 58,000 Building………………….. 900,000 Owner's Equity
Office Equipment……….. 150,000 Joy Santos, capital… 2,200,000

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___________________ Total P 3,000,000

Introduction to Accounting Concepts


Total P 3,000,000

* Property of STI
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Basic Financial Statements ___________________
Sample Financial Statements
___________________
JOYLAND TRAVEL AGENCY ___________________
Statement of Owner's Equity
Month Ended September 30, 2006 ___________________
___________________
Joy Santos, capital, September 1, 2006……. P 1,663,000
___________________
Add: Investments by owner ………………….. 500,000
Net income for the month………………. 58,000
___________________
2,221,000 ___________________
Less: Withdrawals by owner ………………… 21,000 ___________________
Joy Santos, capital, September 30, 2006 P 2,200,000
___________________
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