FABM 1 - 1ST QUARTER

• References:


  • Accounting Made Easy (W.Ballada)
  • Simple Accounting (R Liquigan)
  • Accounting Principles (A. Arganda et al)
  • DepEd Reference Book
• Investment


  The exertion of effort, time, money, knowledge and attitude in a particular endeavor with the expectation to achieve desired results and rewards in the process
• Business


  The process of production and selling of goods and services in order to satisfy human needs and wants
• Accounting


  The art of recording, classifying and summarizing in a significant manner the transactions of the Business
• Accounting


  The system that measures the economic activities, processes the information into reports and communicates the results to decision makers
• Direct Users of ACCOUNTING Information:


  • Owner
  • Management
  • Prospective Investors
  • Creditors
  • Employees
  • Government
• PHASES of ACCOUNTING


  • Recording- the process of listing business transactions in a chronological and systematic manner
  • Classifying- sorting and grouping together similar accounting items
  • Summarizing- preparation of Financial reports to summarize data recorded
  • Interpreting - the technicality of accounting reports
• Fundamental Concepts of ACCOUNTING

  • Entity Concept
  • Periodicity Concept
  • Stable Monetary Unit Concept
  • Going Concern Concept
• Basic Principles of ACCOUNTING


  • Objectivity principle
  • Historical Cost
  • Revenue Recognition Principle
  • Expense Recognition Principle
  • Adequate Disclosure
  • Materiality
  • Consistency
  • Matching Principle ( Cost=Revenues)
  • Conservatism( Assets & Income should not be overstated, Liability & Expense should not be understated)
• FIELDS of ACCOUNTING


  • Public Accounting
  • Private Accounting
  • Government Accounting
  • Social Accounting
  • Accounting Education
  • International Accounting
• ASPECTS OF THE BUSINESS

  • Human Resources
  • Marketing
  • Production / Technical
  • Financial
  • Socio Economic
• BUSINESS ORGANIZATIONS


  • According to Nature
  • According to Ownership
• Accounting is a language of business because business uses accounting to report the state of the business
• Relevance of accounting: allow you to gain understanding of how the business operates and the reasoning involved in the making of Business decisions.
• owner in charge of decision
• management under owner, in charge of decision
• prospective investors uses accounting information to see return of investment
• creditors uses accounting information to see the individual/business ability to pay back
• employees uses accounting information for remuneration which is defined as the money and benefits someone receives after performing a service
• government uses it for taxes
• Entity concept means that an organization stand apart from other organizations and individuals as a separate economic unit. The owner is a different entity from the business.
• periodicity concept means an entity's life can be meaningfully subdivided into equal time periods for reporting purposes (daily, weekly, monthly, quarterly, etc)
• Stable monetary unit concept means the peso is a reasonable unit of measure and its purchasing power is relatively stable. Assuming a certain point to avoid confusion.
• Going concern concept assumes that business operations will be continuous
• public accounting is the practice of providing auditing, accounting, and tax services to clients (with fee per consultation)
• Private accounting means that the accountant is employed an a regular in the company. Paid in salary
• internal auditing poses the chances of connivance between employees
• external auditing is done by a person outside of the company that no one knows. produces more accurate results.