Accounting (Intro)

Accounting

- Another type of language for business - The art and science of recording, classifying, and summarizing in a significant manner and in terms of money; transactions and events which are, in part of at least, of a financial character and interpreting the results thereof

Merchandising

- Buy and sell - Ex. watsons, mercury drug, lawsons

Manufacturing

- Create products from scratch ----> sell - Ex. Rags to riches, car manufacturers

Accounting Cycle

- Identifying and analyzing business transactions - Recording journal entries - Posting transactions to ledger - Unadjusted Trial Balance - Adjusting entries - Adjusted trial balance - Financial statements - Closing entries - Revising entries (optional)

Public Accounting

- One accountant: multiple clients - Management, consultancy, auditing, tax preparation

Industry/Private Accounting

- Only 1 client - Management, consultancy, auditing, tax preparation, cost and budgeting

Service

- Selling skill - Ex. spas, salon, car wash, law offices

Forms of Business Organizations (Activities)

- Service - Merchandising (buy and sell) - Manufacturing

Forms of Business Organizations (Ownership)

- Sole proprietorship - Partnership - Corporation - Cooperative

Auditor

(Connected to 423 B.C.) The reports that were taken by these certain accountants were given orally, hence the name: _____

Branches of Accounting

(P.A.G.I.) Public accounting Accounting education Government accounting Industry accounting

Cooperative

- A group of people with a common role - What you call the people that are part of a cooperative: members

Government Accounting

How public funds have been generated and utilized

Industrial Revolution

Industrial companies set out to gain financing and maintain efficiency through operations

External Users

Make decisions concerning the relationship with the enterprise (Ex. Buyers and Taxing Authorities)

Internal Users

Make decisions that directly affect the internal operations of the enterprise (Ex. Labor Unions)

Accounting Education

Training and the technical study of accounting

International Financial Reporting Standards (IFRS)

What accounting standards is the Philippines currently using?

Sole Proprietorship

Formed and owned by a single individual

Partnership

A binding contract that has the intention of connecting 2 or more persons to contribute money, property or industry to a common fund

2500 B.C.

Accounting records were kept by taxing and spending on public works

Corporation

An artificial being created by operation of law, having the right of succession and the powers, attributes and properties expressly authorized by law of incident to its existence - Corporation code of the Philippines

500 B.C.

Egyptians carried on with accounting records and even invented the first bead and wire abacus

Fra Luca Pacioli

Father or Accounting

Generally Accepted Accounting Principles (GAAP)

The US developed shortly after by the American Institute of Certified Public Accountants (AICPA) and the Financial Accounting Standards Board (FASB) in 1939

423 B.C.

The auditing profession was born to double check storehouses as to what came in and out the door