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CLASSIFICATION

Classification: Asset, Liability, Revenue, Expense? If you think that

Answer the following questions
any item might fit into more than one of these categories, explain why?
(Hint: Use the accounting equation.)
Interest payable -> L
Interest receivable -> A
1. Cadence Office Supplies has assets equal to $123,000 and liabilities
equal to $47,000 at year-end. What is the total equity for Cadence at year-
a. Bank A -> cash at bankh. Land mortaged to a Building SocietyA end? 76000
b. Mary, Capital E i. Mortage Payable L 2. At the beginning of the year, Addison Company’s assets are $300,000
c. Accounts Payable L and its equity is $100,000. During the year, assets increase $80,000 and
j. Motor Vehicles A
Rent cho thue nha -> revenue liabilities increase $50,000. What is the equity at the end of the year? 130k
d. Accounts Receivable A e.
di thue nha -> expense
e. Inventory for Furniture k. Salaries & Wages expense 3. At the beginning of the year, Quasar Company’s liabilities equal
Fabrics A l. Repair Fees E $70,000. During the year, assets increase by $60,000, and at year-end
E (trong bi cnh mình i vay) hoc R (trong bi
cnh mình cho vay)Interest
f. trong dkien tr luôn m. Inventory of Other Materials assets equal $190,000. Liabilities decrease $5,000 during the year. What
g. Investment A A
n. Tools are the beginning and ending amounts of equity? 60k - 125k

MATCH EACH OF THE FOLLOWING STATEMENTS MATCH EACH OF THE FOLLOWING STATEMENTS
WITH ITS PROPER TERM WITH ITS PROPER TERM

A. Account B. Account Payable C. Account Receivable A. Account B. Account Payable C. Account Receivable
D. Accounting E. Accounting Equation F. Assets D. Accounting E. Accounting Equation F. Assets
G. Financial Accounting H. Management Accounting I. Business transactions G. Financial Accounting H. Management Accounting I. Business transactions
J. Expense K. Liabilities L. Owner’s Equity J. Expense K. Liabilities L. Owner’s Equity
M. Revenue N. Prepaid expense O. Balance sheet M. Revenue N. Prepaid expense O. Balance sheet
P. Statement of Cash flow Q. Statement of Owner’s R. Income Statement P. Statement of Cash flow Q. Statement of Owner’s R. Income Statement
Equity Equity

1. An information system that provides reports to stakeholders about the economic

6. The amounts used in the process of earning revenue J -> earn: thuc hien duoc
activities and condition of a business D-> shareholder: c ông, Stakeholder: các bên lquan
7. A specialized field of accounting concerned primarily with the recording and
2. Assets = Liabilities + Owner’s Equity E
reporting of economic data and activities to stakeholders outside the business G
3. The resources are owned or controlled by a business F
8. A summary of the revenue and expenses for a specific period of time such as
4. A list of assets, liabilities and owner’s equity that have occurred during a specific period
a month or a year R
of time, such as a month or a year O
9. The rights of creditors that represent debts of the business K
5. An economic event or condition that directly changes an entities’s financial condition or
10. The rights of the owners L
directly affects its results of operations I

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MATCH EACH OF THE FOLLOWING STATEMENTS MATCH EACH OF THE FOLLOWING STATEMENTS
WITH ITS PROPER TERM WITH ITS PROPER TERM

A. Account B. Account Payable C. Account Receivable

D. Accounting E. Accounting Equation F. Assets
A. Account B. Account Payable C. Account Receivable
G. Financial Accounting H. Management Accounting I. Business transactions
D. Accounting E. Accounting Equation F. Assets
J. Expense K. Liabilities L. Owner’s Equity
G. Financial Accounting H. Management Accounting I. Business transactions
M. Revenue N. Prepaid expense O. Balance sheet
J. Expense K. Liabilities L. Owner’s Equity
P. Statement of Cash flow Q. Statement of Owner’s R. Income Statement
M. Revenue N. Prepaid expense O. Balance sheet
Equity P. Statement of Cash flow Q. Statement of Owner’s R. Income Statement
Equity
11. Items such as supplies that will be used in the business in the future N
15. The liability created by a purchase on account B
12.The amount of a business earned by selling goods or services to its
16. A claim against the customer C
customers M
17. An accounting form that is used to record the increases and decreases in each
13. A summary of the cash receipts and cash payments for a specific period of
financial statement item A: 1 cong cu de theo doi su thay doi cua tung item ke toan
time, such as a month or a year P
18. A specialized field of accounting that used estimated data to aid management in
14. A summary of the changes in owner’s equity that have occurred during a
running day-to-day operations and in planning future operations H
specific period of time, such as a month or a year Q

EXERCISE 1
Requirements:

1, LINH deposits ₤ 25,000 in a bank account in the name of ACC 1, Analyse the transactions
2, Exchanged ₤ 20,000 cash for land 2, Making the journal entry and post to T-account
3, Buying supplies for ₤ 1,350 and agreeing to pay the supplier in the near future 2, Build the Financial Statements?
4, During its first month of operations, ACC provided services to customers,
earning fees of ₤ 7,500 and receiving the amount in cash
5, The expenses paid during the month were as follows: wage ₤ 2,125$; rent ₤ 800
and miscellaneous ₤ 725
6, ACC pays ₤ 950 to creditors during the month
7. At the end of the month, the cost of the supplies on hand (not used) is ₤ 550.
The remainder was used in the operation of business and treated as expense
8, At the end of the month, LINH withdraws ₤ 2,000 in cash from the business for
personal use

Analysing the transactions?

Assets = Liabilities + Owner’s Equity
Accounts Show new balances after each transaction.
Cash Supplies Land Payable Capital Withdraw Rev Ex
Leora Holden began a professional practice on June 1 and plans to prepare financial
(1) 25,000 25,000 –investments LINH
statements at the end of each month. During June, Holden (the owner) completed these
transactions.
(2) (20,000) 20,000
a. Owner invested ₤ 60,000 cash along with equipment that had a ₤ 15,000 market value.
(3) 1,350 1,350
b. Paid ₤ 1,500 cash for rent of office space for the month.
(4) 7,500 7,500 Rev c. Purchased ₤ 10,000 of additional equipment on credit (payment due within 30 days).
(5) (3,650) (2,125) Wages d. Completed work for a client and immediately collected the ₤ 2,500 cash earned.
(800) Rent
e. Completed work for a client and sent a bill for ₤ 8,000 to be received within 30 days.
(725) Other
(6) (950) (950) f. Purchased additional equipment for ₤ 6,000 cash.

(7) (800) (800) Supplies g. Paid an assistant ₤ 3,000 cash as wages for the month.

(8) (2,000) (2,000) Withdrawal h. Collected ₤ 5,000 cash on the amount owed by the client described in transaction e.
i. Paid ₤ 10,000 cash to settle the liability created in transaction c.

5,900 +550+20,000 = 400 + 26,050 j. Owner withdrew ₤ 1,000 cash for personal use.

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TRANSACTION ANALYSIS
TRANSACTION ANALYSIS

Josephine's Bakery had the following assets and liabilities at the beginning and
end of the current year:
Assets Liabilities
Beginning of the year ₤ 114,000 ₤ 68,000
End of the year 135,000 73,000

a. If Josephine made no investments in the business and withdrew no assets during

the year, what was the amount of net income earned by Josephine's Bakery?
b. If Josephine invested an additional ₤ 12,000 in the business during the year, but
withdrew no assets during the year, what was the amount of net income earned by
Josephine's Bakery?

In its first year of operations, Case Co. earned $ 60,000 in

revenue and received $52,000 cash from the customers.

The company incurred expenses of $ 37,500 but had not

paid $ 6,000 of them at year-end.

The company also prepaid $ 3,250 cash for expenses that

would be incurred the next year. Calculate the first year’s net
income under both cash basis and the accrual basis of accounting