AP 01.01 — AP 01.

03
Dates @August 31, 2022 8:30 AM-12:00 PM

Course AUD PROB

Notes Answer Problem 1

Status Done

Week Week 1

AP 01.01
Single Entry System
Most common records are cash receipts and cash disbursements

Computation in determining net income or loss is simply to compare the capital or retained
earnings at the beginning if the year and capital or retained earnings at the end of the same
year after taking into consideration drawings or dividends and additional investment.

Cash Basis Accounting

system that recognizes revenue when cash is received and expenses when cash is paid.

Accrual Basis Accounting

Accounting system that recognizes revenue when earned rather than when cash is received
and recognizes expenses as it is incurred rather than when cash is paid.

Comparison of Cash Basis and Accrual Basis Accounting

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 AP 01.02
T- Accounts of AR, NR, Advances from Customers

AP 01.01 — AP 01.03 2
 T-Account of AP, NPT, Advances to Supplier

AP 01.01 — AP 01.03 3
 T- Account of Merchandise Inventory

T- Account of Rent Income & Unearned Rent Income

AP 01.01 — AP 01.03 4
 T- Account of Prepaid Rent and Rent Payable

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 PROBLEM 1

Problem 1 No. 1.1

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 Problem 1 No. 1.2

Problem 1 No. 3.1

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 Problem 1 No. 3.2

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 Problem 1 No. 4

Problem 1 No. 5

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 Problem 1 No. 6

AP 01.03
T-Account for PPE and Accumulated Depreciation

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 T-Account of Capital

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 T- Account of Retained Earnings

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 T- Account of Net Asset

Note: This T-account follows the basic rule in making journal entry that an account is increase
through its normal balance while decrease at the other side of the normal balance.

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 Example: Increase in Net Asset is debited which is the normal balance of the asset while
decrease in net asset is credited which is at the other side of the normal balance.

AP 01.04

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