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    Fundamentals of Accounting 1

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    Estacio B. Iraida Juna
    The document discusses fundamentals of accounting including the basic accounting equation of Assets = Liabilities + Owner's Equity, and provides examples of accounts that would be included in each section of the chart of accounts such as Cash, Accounts Receivable, and Equipment under Assets and Accounts Payable, Notes Payable, and Mortgage Payable under Liabilities. It also includes several activities and questions to help understand accounting concepts like the basic accounting equation and types of major accounts.

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    Fundamentals of Accounting 1

    Uploaded by

    Estacio B. Iraida Juna
    500 views15 pages
    The document discusses fundamentals of accounting including the basic accounting equation of Assets = Liabilities + Owner's Equity, and provides examples of accounts that would be included in each section of the chart of accounts such as Cash, Accounts Receivable, and Equipment under Assets and Accounts Payable, Notes Payable, and Mortgage Payable under Liabilities. It also includes several activities and questions to help understand accounting concepts like the basic accounting equation and types of major accounts.

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    The document discusses fundamentals of accounting including the basic accounting equation of Assets = Liabilities + Owner's Equity, and provides examples of accounts that would be included in each section of the chart of accounts such as Cash, Accounts Receivable, and Equipment under Assets and Accounts Payable, Notes Payable, and Mortgage Payable under Liabilities. It also includes several activities and questions to help understand accounting concepts like the basic accounting equation and types of major accounts.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    500 views15 pages

    Fundamentals of Accounting 1

    Uploaded by

    Estacio B. Iraida Juna
    The document discusses fundamentals of accounting including the basic accounting equation of Assets = Liabilities + Owner's Equity, and provides examples of accounts that would be included in each section of the chart of accounts such as Cash, Accounts Receivable, and Equipment under Assets and Accounts Payable, Notes Payable, and Mortgage Payable under Liabilities. It also includes several activities and questions to help understand accounting concepts like the basic accounting equation and types of major accounts.

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
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    The key takeaways are that the document discusses fundamentals of accounting including the basic accounting equation, chart of accounts, and major account types and classifications.

    The basic accounting equation is Assets = Liabilities + Owner's Equity. It shows the relationship between what is owned (assets), what is owed (liabilities), and the claim on assets by the owner (owner's equity).

    The basic accounting equation works by ensuring that the total assets of a business are always equal to the claims on those assets - which are the liabilities of the business plus the owner's equity in the business. This keeps the accounting records in balance.

    FUNDAMENTALS OF ACCOUNTING

    BASIC ACCOUTING
    EQUATION
    FUNDAMENTALS OF ACCOUNTING
    FUNDAMENTALS OF ACCOUTING
    CHART OF ACCOUNTS
    ASSETS
    • CASH
    • ACCOUNTS RECEIVABLE
    • ALLOWANCE FOR DOUBTFUL ACCOUNTS
    • NOTES RECEIVABLE
    • INTEREST RECEIVABLE
    • UNUSED SUPPLIES
    • PREPAID RENT
    • EQUIPMENT
    • ACCUMULATED DEPRECIATION
    CHART OF ACCOUNTS
    • FURNITURE AND FIXTURES
    • ACCUMULATED DEPRECIATION
    • OTHER ASSETS
    LIABILITIES
    • ACCOUNTS PAYABLE
    • NOTES PAYABLE
    • SALARIES PAYABLE
    • INCOME TAX PAYABLE
    • INTEREST PAYABLE
    CHART OF ACCOUNTS
    • UNEARNED REVENUES
    • MORTGAGE PAYABLE
    • LOAN PAYABLE
    • OTHER LIABILITIES
    CHART OF ACCOUNTS
    OWNER’S EQUITY
    • MERCADO, CAPITAL
    • MERCADO, DRAWER
    • INCOME SUMMARY
    REVENUES
    • PHOTOCOPYING REVENUES
    • INTEREST INCOME
    • OTHER INCOME
    CHART OF ACCOUNTS
    EXPENSES
    • TAX AND LICENSES
    • SALARIES EXPENSES
    • SUPPLIES EXPENSES
    • UTILITIES EXPENSES
    • RENT EXPENSES
    • DEPRECIATION EXPENSES
    • DOUBTFUL ACCOUNTS EXPENSE
    • INTEREST EXPENSE
    ACTIVITY 1
    KNOWING YOU BETTER
    MAJOR ACCOUNT DEFINITION CLASSIFICATION EXAMPLES
    ACTIVITY 2
    YOU MADE ME COMPLETE
    SITUATION ASSETS LIABILITIES OWNER'S EQUITY

    A 150,000 135,000 ?

    B 255,000 ? 35,000

    C ? 68,000 32,000

    D 195,000 135,000 ?

    E 325,000 ? 125,500
    LET'S SHARE!
    How did you find the activity?

    How did you compute the missing


    amount in the table?

    Give the equation you used to come


    up with the correct amount?
    Activity 4: SUM ME UP
    (Group Activity)
    • The total Cash payments made by the business during the first year
    of operation amounted Php 950,000.
    • a. Purchase equipment for the business Php 500,000
    • b. Purchase of delivery truck for the business Php 200,000
    • c. Salaries of the employees, Php 75,000
    • d. Water and electricity used in the business, Php 25,000
    • e. Taxes and licenses of the business, Php 30,000
    • f. Paid rent of the office building for two years, Php 120,000
    (paid at the start of the year)
    • Based on the available information, how much is the total
    expenses of the business in its first year of
    • operation?
    QUESTIONS :
    WHAT IS BASIC ACCOUNTING
    EQUATION?
    HOW DOES THE BASIC ACCOUNTING
    EQUATION WORK ?
    DOES THE BASIC ACCOUNTING
    EQUATION HAVE TO BE BALANCE AT ALL
    TIMES? WHY ?
    WHAT ARE THE TYPES OF MAJOR
    ACCOUNTS?
    A portion of financial statements dated December 31, 2018 with the following

    Accounts and balances were gathered from 3mp’s Photocopy.

    Accounts Payable Php 25,000

    Accounts Receivable Php 52,400

    Accumulated depreciation – Building Php 18,500

    Building Php 200,000

    Cash Php 37,700

    Depreciation Expenses Php 18,000

    Interest Income Php 1,680

    Interest Receivable Php 1,680

    Load Php 50,000

    Mortgage Payable Php 15,600

    Notes Payable Php 19,800

    Notes Receivable Php 14,000

    Office Supplies Php 13,000

    Supplies Expense Php 9,900

    Taxes and Licenses Php 22,800

    Utilities Expense Php 22,800


    REMEMBER :
    LIFE IS LIKE A DOUBLE ENTRY
    ACCOUNTING, EVERYTHING MUST BE
    BALANCED.

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