The Accounting Cycle
© 2009 Larry M. Walther, under nonexclusive license to Christopher J. Skousen & Ventus Publishing ApS. All material in this publication is copyrighted, and the exclusive property of Larry M. Walther or his licensors (all rights reserved).
ISBN 978-87-7681-486-1
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2 The Accounting Cycle Contents
Contents
Part 1: Welcome to the World of Accounting 8
1. Accounting Information 9 1.1 Accounting Def ned 9 1.2 Financial Accounting 9 1.3 Managerial Accounting 10 1.4 A Quality Information System 10 1.5 Inherent Limitations 11 2. The Accounting Profession and Careers 12 2.1 Accounting and Professional Ethics 12 3. The Fundamental Accounting Equation 13 3.1 Assets 13 3.2 Liabilities 13 3.3 Owners’ Equity 13 3.4 Balance Sheet 14 4. How Transactions Impact the Accounting Equation 16 4.1 Edelweiss Collects an Account Receivable 16 4.2 Edelweiss Buys Equipment With Loan Proceeds 17 4.3 Edelweiss Provides Services to a Costumer on Account 18 4.4 Edelweiss Pays Expenses With Cash 19 4.5 Generalizing About the Impact of Transactions 19 4.6 Distinguishing Between Revenue and Income 20