The basic accounting concepts have defined the conception of the preparation of financial statements and the process of preparation in the UK is well regulated. But financial accounting requires a fair amount of flexibility in some certain areas‚ so the need of judgements and estimations for accounts preparers is demand. Meanwhile it leaves a significant approach in accounting treatments. For example‚ when organizations decide which of several inventory valuation methods to utilize; managers make
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U. S. Generally Accepted Accounting Principles (U. S. GAAP) and International Financial Reporting Standards (IFRS) There are numerous companies that use different types of accounting standards or rules. International Financial Reporting Standards (IFRS) and U.S. Generally Accepted Accounting Principles the most popularly used by companies. IFRS is a set of accounting standards that provides a global framework for how public companies prepare and disclose their financial statements. The U.S. Generally
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hand. Under the FIFO method‚ the December 31 inventory is $21‚750. $21‚000. $27‚000. $24‚000. Rudolf Diesel Company’s inventory records show the following data: Units Unit Cost Inventory‚ January 1 5‚000 $9.00 Purchases: June 18 4‚500 8.00 November 8 3‚000 7.00 A physical inventory on December 31 shows 3‚000 units on hand. Under the FIFO method‚ the December 31 inventory is $21‚750. $21‚000. $27‚000. $24‚000. In a period of rising prices‚ FIFO will have lower cost of goods sold than LIFO. lower net income
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Inventory Valuation 1 Lewis Corporation Case: 6-2 Page: 173 2 Lewis Corporation Traditionally used inventory valuation method: FIFO Uses periodic inventory system 3 Inventory Transaction 2005-2007 No. of Cartons Price per Carton 2005 2006 2007 2005 2006 2007 Beginning balance 1840 1020 1040 $20.00 Purchases 600 700 1000 $20.25 $21.50 $22.50 800 700 700 $21.00 $21.50 $22.75 400 700 700 $21.25 $22.00 $23.00 200 1000 700 $21.50 $22.25 $23.50 Sales 2820 3080 2950 $34
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Review sheet Test 2 Chapters 4 & 5 (33 Multiple choice) Chapter 4 ▪ Definitions or calculations presentation on financial statements- Net Sales‚ COGS‚ gross profit‚ selling and administrative expenses o Sale - sale discount = Net sales o Net sale – COGS = Gross profit o Sale discount + net sale= sale o Sale – net sale = sale dis o Net sale – gross profit= COGS New asset -> inventory Expense -> COGS Revenue -> sales Contra revenue (debit)
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1. The final exam will be held from 9:30 to 11:30 am on Wednesday‚ October 19 in EX 200 (255 McCaul). 2. It is a closed book and closed note exam. No aid sheet is allowed. You will need a calculator‚ but no other electronic devices will be allowed during the exam. 3. The exam covers materials in classes 1 through 11 inclusive (i.e.‚ topics 1 through 8)‚ with more emphasis on topics 3 through 8. It will have both problem-solving and essay-type questions. It is not going to be an easy exam
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ACCOUNTING NOTES FOR MY PERSONAL USE 4/12/2013 ELISHA VERIWA | Introduction to Accounting Accountancy is the process of communicating financial information about a business entity to users (stakeholders) such as shareholders and managers (Elliot‚ Barry & Elliot‚ Jamie: Financial accounting and reporting). Accounting has been defined as: * the art of recording‚ classifying‚ and summarizing in a significant manner and in terms of money‚ transactions and events which are‚ in part at least
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external users 4. FASB – responsible for GAAP (accounting principles) 5. Accounting Equation 6. Know the 3 activities that business engage in and give examples of each activity. (These 4 questions also relate to Chapter 12‚ The Statement of Cash Flows) 7. The International Accounting Standards Board is responsible for developing a single set of worldwide accountings standards (IFRS). 8. These standards will help companies to reduce accounting costs‚ make it easier to acquire foreign companies
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ACCT1B - Sample Exam 2 Name: __________________________ Date: _____________ 1. The current period’s ending inventory is: A) The next period’s beginning inventory. B) The current period’s cost of goods sold. C) The prior period’s beginning inventory. D) The current period’s net purchases. E) The current period’s beginning inventory. 2. Sales returns and allowances: A) Can provide useful information about dissatisfied customers and the possibility of lost future sales. B) Are recorded
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gooda available for sale. -the consistency principle states that the busineses should use the same accounting methods from period to period. -under the FIFO‚ the ending inventory is based on the cost of the most recent purchases. -the value of purchases remains the same irrespective of the inventory valuation method used. -using FIFO‚ the COGS is based on the oldest purchases. -the accounting conservatism principle requires that financial statements should report LEAST favorable figures. -do
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