Upload
cyrus-ramos
View
24
Download
0
Embed Size (px)
DESCRIPTION
LESSON 14-1. Distributing Corporate Earnings to Stockholders. STOCKHOLDERS’ EQUITY ACCOUNTS USED BY A CORPORATION. page 405. (3000) STOCKHOLDERS’ EQUITY 3110Capital Stock 3120Retained Earnings 3130Dividends 3140Income Summary. DECLARING A DIVIDEND. page 406. - PowerPoint PPT Presentation
Citation preview
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-1LESSON 14-1
Distributing Corporate Earnings to Stockholders
2
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
STOCKHOLDERS’ EQUITY ACCOUNTS STOCKHOLDERS’ EQUITY ACCOUNTS USED BY A CORPORATIONUSED BY A CORPORATION page 405
(3000) STOCKHOLDERS’ EQUITY3110 Capital Stock3120 Retained Earnings3130 Dividends3140 Income Summary
3
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
DECLARING A DIVIDENDDECLARING A DIVIDEND
11
2233
44
55 66
page 406
December 15. Hobby Shack’s board of directors declared a quarterly dividend of $2.00 per share; capital stock issued is 2,500 shares; total dividend, $5,000.00. Date of payment is January 15. Memorandum No. 79.
4. Write the debit amount.
3. Write the memorandum number.
2. Write the title of the account debited.
1. Write the date.
5. Write the title of the account credited.
6. Write the credit amount.
4
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
PAYING A DIVIDENDPAYING A DIVIDEND
11 22 33 44 55
page 407
January 15. Paid cash for quarterly dividend declared December 15, $5,000.00. Check No. 379.
1. Write the date.
2. Write the account title.
3. Write the check number.
4. Write the debit account.
5. Write the credit amount.
5
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
retained earnings dividends board of directors declaring a dividend
page 408
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-2LESSON 14-2
Beginning an 8-Column Work Sheet for a Merchandising Business
7
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
RECORDING A TRIAL BALANCE ON A RECORDING A TRIAL BALANCE ON A WORK SHEETWORK SHEET page 410
11
33
221. Account title
2. Account balance
3. Total, prove, and rule the debit and credit columns
8
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ANALYZING AND RECORDING SUPPLIES ANALYZING AND RECORDING SUPPLIES ADJUSTMENTSADJUSTMENTS page 411
Adj. (a) 2,730.00
Supplies Expense—Office
Dec. 31 Bal. 3,480.00 Adj. (a) 2,730.00
(Adj Bal. 750.00)
Supplies—Office
Adj. (b) 2,910.00
Supplies Expense—Store
Dec. 31 Bal. 3,944.00 Adj. (b) 2,910.00
(Adj Bal. 1,034.00)
Supplies—Store
9
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
RECORDING SUPPLIES ADJUSTMENTS RECORDING SUPPLIES ADJUSTMENTS ON A WORK SHEETON A WORK SHEET page 412
22
11
1. Write the debit amounts in the Adjustments Debit column.
2. Write the credit amounts in the Adjustments Credit column.
3. Label the two parts of the Supplies—Office adjustment with small letter a and small letter b in parentheses.
33
33
10
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ANALYZING AND RECORDING A PREPAID ANALYZING AND RECORDING A PREPAID INSURANCE ADJUSTMENTINSURANCE ADJUSTMENT
11
22
33
33
page 413
1. Enter the amount of insurance used in the Adjustments Credit column.
2. Enter the same amount in the Adjustments Debit column.
3. Label the two parts of the adjustment with a small letter c in parentheses.
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-3LESSON 14-3
Planning and Recording a Merchandise Inventory Adjustment
12
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
MERCHANDISE INVENTORYMERCHANDISE INVENTORY page 415
13
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ANALYZING AND RECORDING A MERCHANDISE ANALYZING AND RECORDING A MERCHANDISE INVENTORY ADJUSTMENTINVENTORY ADJUSTMENT
11
2233
33
page 416
1. Write the debit amount.
3. Label the two parts of this adjustment with a small letter d in parentheses.
2. Write the credit amount.
14
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ANALYZING AN ADJUSTMENT WHEN ENDING ANALYZING AN ADJUSTMENT WHEN ENDING MERCHANDISE INVENTORY IS GREATER THAN MERCHANDISE INVENTORY IS GREATER THAN BEGINNING MERCHANDISE INVENTORYBEGINNING MERCHANDISE INVENTORY page 417
Jan. 1 Bal. 294,700.00
Adj. (d) 4,200.00
(New Bal. 298,900.00)
Merchandise Inventory
Adj. (d) 4,200.00
Income Summary
15
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERM REVIEWTERM REVIEW
merchandise inventory
page 418
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-4LESSON 14-4
Planning and Recording an Allowance for Uncollectible Accounts Adjustment
17
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ALLOWANCE METHOD OF RECORDING LOSSES ALLOWANCE METHOD OF RECORDING LOSSES FROM UNCOLLECTIBLE ACCOUNTSFROM UNCOLLECTIBLE ACCOUNTS page 419
18
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
EstimatedUncollectible
Accounts Expense
=Percentage×Total Saleson Account
$1,245.00=1%×$124,500.00
ESTIMATING UNCOLLECTIBLE ACCOUNTS ESTIMATING UNCOLLECTIBLE ACCOUNTS EXPENSEEXPENSE page 420
19
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
1. Enter the estimated uncollectible amount.
ANALYZING AND RECORDING AN ADJUSTMENT ANALYZING AND RECORDING AN ADJUSTMENT FOR UNCOLLECTIBLE ACCOUNTS EXPENSEFOR UNCOLLECTIBLE ACCOUNTS EXPENSE
3. Label the two parts with a small letter e in parentheses.
11
22
33
33
page 421
2. Enter the same amount in the Adjustments Debit column.
20
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
uncollectible accounts allowance method of recording losses from
uncollectible accounts book value book value of accounts receivable
page 422
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-5LESSON 14-5
Planning and Recording Depreciation Adjustments
22
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
CALCULATING DEPRECIATION EXPENSE CALCULATING DEPRECIATION EXPENSE AND BOOK VALUEAND BOOK VALUE page 424
Estimated TotalDepreciation
Expense=
EstimatedSalvage Value
–Original
Cost
$1,000.00=$250.00–$1,250.00
AnnualDepreciation
Expense=
Years ofEstimated
Useful Life÷
Estimated TotalDepreciation
Expense
$200.00=5÷$1,000.00
1. Subtract the asset’s estimated salvage value from original cost.
2. Divide the estimated total depreciation expense by the years of estimated useful life.
11
22
(continued on next slide)
23
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
CALCULATING DEPRECIATION EXPENSE CALCULATING DEPRECIATION EXPENSE AND BOOK VALUEAND BOOK VALUE page 424
20X3AccumulatedDepreciation
=20X3
DepreciationExpense
+20X2
AccumulatedDepreciation
$600.00=$200.00+$400.00
EndingBook Value
=AccumulatedDepreciation
–Original Cost
$650.00=$600.00–$1,250.00
(continued from previous slide)
24
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
ANALYZING AND RECORDING ADJUSTMENTS ANALYZING AND RECORDING ADJUSTMENTS FOR DEPRECIATION EXPENSEFOR DEPRECIATION EXPENSE page 425
11
22
33
33
1. Write the debit amounts.
2. Write the credit amounts.
3. Label the adjustments.
25
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
TERMS REVIEWTERMS REVIEW
current assets plant assets depreciation expense estimated salvage value straight-line method of depreciation accumulated depreciation book value of a plant asset
page 426
CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
LESSON 14-6LESSON 14-6
Calculating Federal Income Tax and Completing a Work Sheet
27
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
FEDERAL INCOME TAX EXPENSE FEDERAL INCOME TAX EXPENSE ADJUSTMENTADJUSTMENT page 427
Total of Income Statement Credit column $
500,253.10Less total of Income Statement Debit column
before federal income tax–
396,049.91Equals Net Income before Federal Income Tax $
104,203.19
28
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
CALCULATING FEDERAL INCOME TAXCALCULATING FEDERAL INCOME TAX page 428
29
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
1. Calculate the amount of federal income tax expense adjustment.
RECORDING THE FEDERAL INCOME TAX RECORDING THE FEDERAL INCOME TAX ADJUSTMENTADJUSTMENT
22
33
33
11
11
page 429
2. Total and rule the Adjustments columns.
3. Extend account balances.
30
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
COMPLETING A WORK SHEETCOMPLETING A WORK SHEET
11 11
page 430
2244 3355
1. Total the Income Statement and Balance Sheet columns.
5. Rule double lines.
4. Calculate the column totals.
3. Extend the net income amount.
2. Calculate and enter the net income after federal income tax.
31
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
A COMPLETED 8-COLUMN A COMPLETED 8-COLUMN WORK SHEETWORK SHEET page 432
32
LESSON 14-1CENTURY 21 ACCOUNTING © 2009 South-Western, Cengage Learning
A 10-COLUMN WORK SHEETA 10-COLUMN WORK SHEET page 434-435
1. Trial balance
4466
22 33 55
5. Extend balances
2. Adjustments
3. Extend adjusted balances
4. Total, prove, and rule
6. Calculate net income; total, prove and rule
11