Accounting Lectures

4Lecture-1 ü Accounting Equation: o Assets [A]= Liabilities [L] (Obligations) + Shareholders equity [SHE] [Economic Resources] [Sources of financing for scotch resources] X - Company Assets 1,000,000 Liabilities 800,000 80% Shareholders Equity 200,000 20% Debt residual = 800,000 1,000,000 80% Y-Company 1,000,000 400,000 40% 600,000 60% 400,000 1,000,000 40% Risky bureau sound Position ü business Transaction: o An occurrence which has an immediate (on the resembling day) effect on the elements of financial positions [A L SHE]. ü Ex-1: X-Corporation in 1/1/2011 hired 10 employees for a periodical net profit $ 20,000. Does this event considered as a Business Transaction? o Its an event but has no immediate effect on the financial position. o So, its not considered a business transaction. ü Ex-2: On 31/1/2011 Company-X paid the salaries of the employees specie. Salaries expenses ?20,000 Cash (Asset) ?20,000 ?A = L + ?SHE (-20,000)= No effect (NE) (-20,000) N.B ü ? tax revenues & Gains ? ? Shareholders equity. ü ?Expenses & losings ? ?Shareholders equity. ü When dividends are declared? ?Shareholders equity. tax revenue *The value of goods sold and/or services provided.

*Its the gross increase in the assets or the diminish in liabilities resulting from business transactions entered into to seduce income. PDF created with pdfFactory Pro tryout version www.pdffactory.com ü Ex-3: ABC-Advertising company provided services hard hard currency in for $ 10,000. Cash (Asset) ?10,000 Advertising Revenue ?10,000 ?A = L + ?SHE (+10,000)= No effect (NE) (+10,000) ü Ex-4: ABC-Advert ising company provided services to X for $ 5! ,000 on al-Qaida (on credit). N.B On Account = On Credit = Cash to be accepted in a future involvement. Accounts Receivable[AR] (Asset) ?5,000 Advertising Revenue ?5,000 ?A = L + ?SHE (+5,000 AR)= (NE) (+5,000) Unearned Revenue Its a cash that is received in advance for services not to date provided and its considered a Liability. ü Ex-4: On 1/3 ABC received $45,000 cash from...If you want to get a full essay, order it on our website: BestEssayCheap.com

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