ACCOUNTINGSTEPBYSTEPTHELANGUAGEOFDEBITANDCREDIT…一步的借方與貸方會計步語言…117課件

1、 2 CHAPTER I - INTRODUCTION TO BOOKKEEPING In 2019 all the hard work of bookkeeping is now done by computer. But . We must understand the language of debit and credit, so that we can use the computer data to produce RELIABLE accounting reports in accordance with IAS (International Accounting Standar

2、ds).第1頁，共117頁。3No matter what the form of the record, the basic rule of bookkeeping remains the same: the concept of debit and credit.The five key steps are .第2頁，共117頁。Book-keeping and AccountingThe process of book-keeping and accounting may be summarized into the following five steps: A. BOOK-KEEPI

3、NG 4A. BOOKKEEPING: I. Translate transactions into debits and credits in a journal. 2. Post the debits and credits to ledger accounts.3. Balance the ledger accounts to summarize the net effect of the entries.4. Extract a trial balance to check the arithmetical accuracy of the postings.第3頁，共117頁。 5B.

4、 ACCOUNTING5. From the trial balance prepare the accounting reports, balance sheet and income statement (profit and loss account) with IAS!第4頁，共117頁。Accounting LanguageAccounting has been called the language of business. Like any language, it can never express our thoughts with absolute precision an

5、d clarity. 6Our task of learning this language is complicated by the fact that many of the words used in accounting mean almost, but not quite, the same as they mean in every-day life. We must learn to think of words in their accounting rather than their popular meaning. In this program, we have use

6、d a standard set of English and American accounting terms, although certain other terms are also of accounting terms reinforces your basic grasp of the language.第5頁，共117頁。 7 Accounting PeriodThe basis of all profit is the period (accounting period) during which the profit is realized. Thus $10 a wee

7、k is not the same as $10 for a whole year. Again, the financial position of a business must relate to a particular date. Thus the picture at January 1st may not be the same as the picture at June 3oth. Therefore, the accounting period and the date, is vital information which affect the significance

8、of the accounting reports.第6頁，共117頁。8A glossary of common bookkeeping words is provided at the end of the program.The following list indicates some of the major differences between English and American terminology:第7頁，共117頁。 9 English Term American TermDebtors Accounts receivable Creditors Accounts

9、payable Stock of goods InventoryShare capital Capital stockProfit IncomeAccumulated profits Retained earnings Profit and loss account Income statement 第8頁，共117頁。Debit & Credit 10 Some textbooks teach the application of debit and credit as: (a) Credit the giver (b) Debit the receiver 第9頁，共117頁。 11 Ho

10、wever this has certain logical limitations. So, in this program we use a different approach. We first define:(a) Debit, as the left-hand side(b) Credit, as the right-hand side(c) Basic debits as, assets, costs and expenses(d) Basic credits, as liabilities, owners equity and sales This facilitates ve

11、ry rapid assimilation of the bookkeeping technique, while the computer does all the hard work!第10頁，共117頁。 12 CHAP TER II - ACCOUNTING REPORTSSET I - INCOME STATEMENT (PROFIT AND LOSS ACCOUNT) SUMMARYThe income statement (profit and loss account) of a business relates to a specific accounting period.

12、 It matches sales against cost of ales and expenses, to compute a figure of profit for the accounting period.Profit realized is NOT the same as cash received.Cash is more important than profit!第11頁，共117頁。13Sales, less cost of sales and less expenses, equals profit.Sales equals cost of sales, plus ex

13、penses, plus profit.第12頁，共117頁。14IMPORTANT NOTEIn the front of each set is a summary (as above) of technical terms and ideas to be learned from the set. Read it quickly.If you already understand all of the summary do not complete the set, pass on to the next one.If you do not completely understand e

14、very technical term and idea in the summary, do the whole set. Do not attempt to do only parts of a particular set.第13頁，共117頁。 15CHAPTER II SET 2 - BALANCE SHEET SUMMARYThe balance sheet presents a financial picture of a business and lists the assets, liabilities and owners equity of the business at

15、 a specific date. It is not the same as an income statement.Valuable things owned by a business such as cash, debtors, inventory (stock), prepaid expenses and car are assets. Creditors are liabilities.第14頁，共117頁。16The owners equity is the original investment of the owners (share capital) in the busi

16、ness plus the profits earned and left to accumulate in the business.第15頁，共117頁。17Assets are generally recorded at cost or lower and NOT at higher resale prices - very conservative!.第16頁，共117頁。18Assets less liabilities equals owners equity or net worth.Assets equals liabilities plus owners equity.第17

17、頁，共117頁。 19Note. (a)In our balance sheets we shall (for bookkeeping) always record assets on he left side, and liabilities and owners equity on the right side.Note: In some countries they may present the balance sheet in many different ways . but in bookkeeping . debit (left) and credit (right) are

18、always the same. hooray!第18頁，共117頁。 20(b) Remember: Debtors are receivables Creditors are payables Stock is inventory Accumulated profit is retained earnings Profit is income第19頁，共117頁。21CHAPTER II - SET 3 - BUSINESS TRANSACTIONSTransactions may be for cash or for credit. In a credit transaction lia

19、bility is incurred but cash is transferred later as a separate transaction.All transactions have a dual aspect (debit & credit) and thereby affect two items on the balance sheet.第20頁，共117頁。 22Accounting conventions recognize transactions at particular times. For example:Sales transactions are genera

20、lly recognized when the goods leave the sellers premises, whereas Purchase transactions arc normally recognized when the goods are received by the buyer.第21頁，共117頁。1. An instantaneous financial picture of a business as of a particular date is a.income statementb.statement of accumulated profitc.bala

21、nce fit and loss accountC第22頁，共117頁。2. An accounting report of the flows of sales, costs, expenses and net profit over an accounting period is called a: a.sales reportb.balance sheetc.income statementd.owners equityC第23頁，共117頁。3. In a balance sheet the assets are exactly equal to the:a.lia

22、bility to creditorsb.owners equityc.current assetsd.claims against the assetsD第24頁，共117頁。4.Owners claims against the assets of a business are called: a. liabilities b. capital stock c. owners equity d. incomeC第25頁，共117頁。5.Valuable things owned by a business are called:a.capitalb.assetsc.fixed assets

23、d.liabilitiesB第26頁，共117頁。6.Assets less liabilities equals:a.share capitalb.accumulated profitsc.owners equityd.salesC第27頁，共117頁。7.People who owe debts to a business are listed on a balance sheet of that business as:a.trade creditorsb.incomec.claims against the assetsd.debtorsD第28頁，共117頁。8.Land, buil

24、ding, etc., owned by a manufacturing business is a:a.current assetb.other assetc.fixed assetd.capitalC第29頁，共117頁。9.Stock is a:a.fixed assetb.part of owners equityc.assetd.claim which the business agrees to payC第30頁，共117頁。10.The owners equity of a limited company consists of:a.share capital and accum

25、ulated profitsb.share capitalc.assetsd.dividendsA第31頁，共117頁。11.Assets less owners equity equals:a.claims of the shareholdersb.current liabilitiesc.capitald.liabilitiesA第32頁，共117頁。.12.If a business has cash of 2,000, trade creditors of 100, a mortgage payable of 5,000 and land of 10,000 the owners eq

26、uity is:a.impossible to computeb.10,000c.5,100d.6,900D第33頁，共117頁。13.A balance sheet is prepared for a business entity. For a limited company this entity is:a.the company and its managementb.the company and its shareholdersc.the shareholders aloned.the company aloneB第34頁，共117頁。B 22.Which of the follo

27、wing are basic debits?a.liabilitiesb.fixed assetsc.owners equityd.share capital第35頁，共117頁。 23CHAPTER III - BOOK-KEEPING TECHNIQUESET 4 - DEBIT AND CREDIT SUMMARYDebit means left-hand side. Credit means right-hand side. In bookkeeping debit and credit have NO significance as being good or bad as is i

28、mplied by the popular use of the same words.第36頁，共117頁。 24Each item in the balance sheet and income statement is, by convention, either a basic debit or a basic credit: 1. The items on the left-hand side: assets, costs and expenses are basic debits. 2. The items on the right-hand side: liabilities a

29、nd owners equity and sales are basic credits.第37頁，共117頁。 25A basic debit is increased by debits and decreased by credits. Conversely a basic credit is increased by credits and decreased by debits.Each business transaction has a debit aspect and a credit aspect of the same amount. Thus in a set of bo

30、oks the total debits always equal the total credits.Dr means debit. Cr means credit.第38頁，共117頁。26IMPORTANT NOTEAt this point we must unlearn something about the words debit and credit, which is current in every-day life but does NOT apply to bookkeeping!Repeat aloud the following sentences:Credit me

31、ans right side, It does not mean good or bad. Debit means left side. It does not mean good or bad.第39頁，共117頁。28 CHAPTER III SET 5 ACCOUNTS AND BALANCESUMMARYFor each basic debit item and each basic credit item in the accounting reports there is an account in the books of the business. An account is

32、simply a page in the books. In a series of accounts in the books we analyze and summarize each aspect (Dr and Cr) of a large number of business transactions.第40頁，共117頁。29The balance brought down summarizes the net amount of the transactions recorded in the account to date. Each account may have a de

33、bit or credit balance according to the net total of debit and credit postings.第41頁，共117頁。 30CHAPTER III SET 6 - CASH AND CREDIT SUMMARYIn bookkeeping the word credit has two meanings: Credit means NOT for cash Credit means right side of the account, the opposite of debit.第42頁，共117頁。 31Transactions m

34、ay be either for cash or credit Cash transactions are either cash receipts or cash payments, which increase or decrease the cash balance.Credit transactions increase either receivables or payables, but NOT cash . until they are paid with a cash transaction!.第43頁，共117頁。 32Cash is an asset and therefo

35、re a basic debit. 第44頁，共117頁。 33In terms of debit and credit, cash sales and purchases are recorded thus:Cash receipts: Cash account Dr. Sales account Cr.Cash payments:. Purchases account Dr. Cash account Cr 第45頁，共117頁。 34Credit transactions do not affect the balance of cash but they do increase deb

36、tors (basic debits) or creditors (basic credits). Remember - debtors - receivables - basic assetCreditors - payables - basic credit第46頁，共117頁。 35Credit transactions for sales and purchases are recorded thus:Credit sales: Debtor (receivable) account Dr. Sales account Cr Credit purchases: Purchases ac

37、count Dr Creditor account Cr. 第47頁，共117頁。 36CHAPTER III SET 7 - JOURNALIZING TRANSACTIONS SUMMARYThis is a revision set to give you practice in journalizing transactions by translating them into debits and credits.The journal of a business is the book in which any transaction may be recorded in the

38、following form of entry.第48頁，共117頁。 37FORM OF GENERAL JOURNAL ENTRY:DateAccount name Dr 1000 Account name Cr 1000Plus an explanation of the transaction for future reference.第49頁，共117頁。 22.Which of the following are basic debits?a.liabilitiesb.fixed assetsc.owners equityd.share capitalB第50頁，共117頁。 23

39、.Which of the following are basic credits?a.assetsb.costsc.owners equityd.expensesC第51頁，共117頁。 24.A debit balance is increased by a:a.creditb.debitc.something elsed.both credits and debitsB第52頁，共117頁。25. A basic debit is decreased by a:a.creditb.debitc.neitherd.both debits and creditsA第53頁，共117頁。26.

40、A basic credit is decreased by a:a.debitb.creditc.neitherd.both debits and creditsA第54頁，共117頁。 27.Debtors are decreased by:a.debitsb.creditsc.something elsed.both debits and creditsB第55頁，共117頁。 28.Expenses are increased by:a.debitsb.creditsc.something elsed.both debits and creditsA第56頁，共117頁。29.Sale

41、s are increased by:a.debitsb.creditsc.something elsed.both debits and creditsB第57頁，共117頁。37. Creditors normally have a balance:a.debitb.creditc.something elsed.debit or creditB第58頁，共117頁。38. Debtors normally have abalance:a.debitb.creditc.something elsed.both debit and creditA第59頁，共117頁。39. Owners e

42、quity and profits normally have abalance:a.debitb.creditc.something elsed.both debit and creditB第60頁，共117頁。40.Expenses and sales normally have balance which are:a.the same-debitb.the same-creditc.credit and debit respectivelyd.debit and credit respectivelyD第61頁，共117頁。41. Assets normally have abalanc

43、e:a.debitb.creditc.something elsed.both debit and creditA第62頁，共117頁。C42.Posting in book-keeping means:a.writing in the journalb.journalizingc.writing in the ledger accountsd.preparing a trial balance第63頁，共117頁。 38 CHAPTER IV - SPECIAL TRANSACTIONSSET 8 ACCRUALS SUMMARYAccruals are credit transaction

44、s. They record a liability not yet paid for. The liability may be for the purchase of a fixed asset, or a cost or an expense incurred. Thus the books and the accounting reports must show the full liabilities of a business. Settlement of the accrual in cash, is a subsequent cash transaction.第64頁，共117

45、頁。 39To record an accrual we journalize: Asset (basic debit Dr. Creditor (basic credit) Cr. OR Cost (basic debit) Dr. Creditor (basic credit) Cr. OR Expense (basic debit) Dr. Creditor (basic credit) Cr.第65頁，共117頁。 40To record the cash settlement of the accrual we journalize: Creditor (basic credit)

46、- decreased Dr. Cash (basic debit) - decreased Cr.第66頁，共117頁。 41CHAPTER IV SET 9 - FIXED ASSETS AND DEPRECIATION SUMMARYFixed assets, such as land, buildings, machinery, plant, furniture, trucks, cars, etc., are normally purchased for use in the business, and not for resale.The process of depreciati

47、on allocates the cost of each fixed asset to depreciation expense proportionally over its working life. It is a process of allocation not valuation of the fixed asset, Depreciation expense (basic debit) is shown in the income statement.第67頁，共117頁。42Fixed assets (basic debits) are shown in the balanc

48、e sheet at cost, less accumulated depreciation (basic credit). Exception: Land is not depreciated - shown at cost until revalued.第68頁，共117頁。 43The amount charged to depreciation expense for the accounting period may be journalized in one of two ways:I.Directly against the cost of the fixed asset: De

49、preciation expense (basic debit) Dr Fixed asset (basic debit) Cr OR 第69頁，共117頁。 44 2.Through an intermediate account deducted from the cost of the fixed asset in the balance sheet: Depreciation expense (basic debit) Dr Accumulated depreciation (basic credit) Cr.Note: Accumulated depreciation is dedu

50、cted from the total of fixed assets (basic debits) on the left side of the balance sheet. It is therefore a basic credit (not basic debit).第70頁，共117頁。44.A cash payment is journalized:a.debit cash, credit some other accountb.debit some other account, credit debtorsc.debit cash, credit creditorsd.cred

51、it cash, debit some other accountD第71頁，共117頁。45.Cash receipts are always journalized as debit to:a.debtorsb.creditorsc.owners equityd.something elseD第72頁，共117頁。46.Credit sales are journalized:a.credit debtors, debit salesb.debit cash, credit salesc.debit creditors, credit salesd.debit debtors, credi

52、t salesD第73頁，共117頁。47.A cash purchase is always recorded as a credit to:a.creditorsb.assetsc.cashd.purchasesC第74頁，共117頁。49.Receipt from a debtor is journalized as:a.debit sales, credit cashb.debit debtors, credit cashc.debit debtors, credit salesd.debit cash, credit debtorsD第75頁，共117頁。50. A credit t

53、ransaction is normally followed by a cash transaction:a.trueb.falsec.neitherd.bothA第76頁，共117頁。51. Cash is a basic:a.debitb.creditc.neitherd.debit or creditA第77頁，共117頁。52.In the cash account cash receipts are:a.debitsb.creditsc.neitherd.both debits and creditsA第78頁，共117頁。53.In the cash account cash p

54、ayments are:a.debitsb.creditsc.neitherd.both debits and creditsB第79頁，共117頁。54.Debtors are:a.debitsb.creditsc.neitherd.both debits and creditsA第80頁，共117頁。55.A debit balance on a creditors account probably means:a.we owe him moneyb.he owes us moneyc.something elsed.there is an error or a return to sup

55、plier.B/D第81頁，共117頁。56. Purchase of land on credit is recorded:a.debit purchases, credit cashb.debit cash, credit landc.debit land, credit creditorsd.something elseC第82頁，共117頁。57.Purchase of machinery for cash is recorded:a.debit cash, credit machineryb.debit debtors, credit machineryc.credit cash,

56、debit machineryd.something elseC第83頁，共117頁。D58.Payment of rent in cash is recorded:a.debit rent, credit creditorsb.credit rent, debit cashc.debit rent, credit debtorsd.something else第84頁，共117頁。 45CHAPTER V RECORDSSET 10 - JOURNALS AND LEDGERS SUMMARYBooks of account may be divided into books of. Pri

57、me entry (journals) Second entry (ledgers)第85頁，共117頁。 46In the journal each transaction is translated into debits and credits, Only one journal is essential but in practice we have separate journals for each main source of transactions.第86頁，共117頁。 47 The cash book (journal) records cash receipts and

58、 payments. The sales journal records credit sales. The purchases journal records credit purchases. The general journal records all types of transactions第87頁，共117頁。48The sales journal and the purchases journal summarize one side of transactions so that the debit to purchases and the credit to sales m

59、ay be made in total figures, instead of in detail for each transaction.第88頁，共117頁。 49Posting to the ledger accounts is made from the journals. Each ledger includes a series of accounts to record the debit and credit aspects of the transactions. 第89頁，共117頁。 50Three separate ledgers are usually kept.

60、The sales ledger contains an account for each debtor. The purchases ledger contains an account for each creditor, In the general (private) ledger are all the other accounts for assets, liabilities, owners equity, sales, costs and expenses第90頁，共117頁。 51 CHAPTER V - SET 11 - TRIAL BALANCE SUMMARYBookk