General Ledger Application Small Business Information System Barry Floyd.

Slides:



Advertisements
Similar presentations
Review of the Accounting Process INTERMEDIATE ACCOUNTING I CHAPTER 2 This presentation is under development.
Advertisements

General Ledger and Reporting System
Chapter 16 General Ledger and Reporting System Copyright © 2012 Pearson Education, Inc. publishing as Prentice Hall 16-1.
Review of the Accounting Process
The Adjusting Process ACG 2021 Chapter 3.
Accounting for Transactions and the Financial Statements
Chapter 3 Accounting Information System The Basics of Financial Accounting.
Copyright © 2015 Pearson Education, Inc. General Ledger and Reporting System Chapter
Chapter 4: Adjustments, Financial Statements, and Financial Results Learning Objective 1 Explain why adjustments are needed. 4-1.
Cash, Short-term Investments and Accounts Receivable
3-1 Intermediate Accounting 15th Edition 3 The Accounting Information System Kieso, Weygandt, and Warfield.
Infosys - 1 The Accounting Information Processing System.
Question Answer Accounting I Debits & Credits Analyzing.
Review of the Accounting Process
Review of the Accounting Process
Chapter 4 Adjustments, Financial Statements, and the Quality of Earnings 9/07/04.
Review of the Accounting Process
Adjusting Entries. Measuring Business Income n Accounting period assumption n Cash accounting versus accrual accounting n Matching principle n Materiality.
Adjustments to the Accounts Most transactions are recorded when they occur. Some transactions might not even seem like transactions and are recognized.
Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Slide 2-1 Chapter Two Review of the Accounting Process.
Chapter 4 Adjustments, Financial Statements, and the Quality of Financial Reporting Chapter 4: Adjustments, Financial Statements, and the Quality of Financial.
COPYRIGHT © 2007 Thomson South-Western, a part of The Thomson Corporation. Thomson, the Star logo, and South-Western are trademarks used herein under license.
Unit 13 – Adjusting and Closing Entries. Previously… All adjustments were made on the work sheet. The ledger accounts have not yet been changed. (currently,
Chapter 6 Accrual Accounting Concepts and the Accounting Cycle.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved. Adjustments, Financial Statements, and the Quality of Earnings Chapter 4.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved. Adjustments, Financial Statements, and the Quality of Earnings Chapter 4.
Income Measurement and Accrual Accounting
Adjustments, Financial Statements, and the Quality of Earnings Chapter 4 McGraw-Hill/Irwin © 2009 The McGraw-Hill Companies, Inc.
Week 6.  Need to update certain general ledger accounts at the end of the fiscal period.  Reflect “internal” transactions ◦ Supplies used ◦ Prepaid.
Copyright © 2007 by The McGraw-Hill Companies, Inc. All rights reserved. Adjustments, Financial Statements, and the Quality of Earnings Chapter 4.
June 27 Chapter 3. 1.Real (permanent) accounts are revenue, expense, and dividend accounts and are periodically closed. 2.Under International Financial.
Chapter 4 Income Measurement and Accrual Accounting
Adjusting the Accounts –Part I Accounting Principles, Ninth Edition Introduction to Accounting.
Adjusting Accounts & Preparing Financial Statements
Recognition: formally recording an item in the financial statements of an entity Recognition and Measurement I know I need to record this... Measurement:
McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved. Chapter 7 Accounting Information Systems.
Adjustments, Financial Statements, and the Quality of Earnings
THE ACCOUNTING CYCLE: Closing Entries 1. Previous Lecture 2 Unadjusted Trial Balance Adjustments Adjusted Trial Balance Income statement Balance Sheet.
ACTG 3110 Chapter 3 – The Accounting Information System.
7/e PowerPoint Author: Catherine Lumbattis COPYRIGHT © 2011 South-Western/Cengage Learning 4 Income Measurement and Accrual Accounting.
Review of the Accounting Process
3-1 Intermediate Accounting 15th Edition 3 The Accounting Information System Kieso, Weygandt, and Warfield.
Spiceland | Thomas | Herrmann Financial Accounting Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without.
Accounting Theory.  Accounting Period Cycle ◦ Preparing financial statements at the end of each fiscal period  Adjusting Entries ◦ Journal entries recorded.
The Accounting Information System 3.
The Accounting Cycle Transactions 1. Journalization 6. Financial Statements 7. Closing entries 8. Post-closing trail balance 9. Reversing entries 3. Trial.
Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved. McGraw-Hill/Irwin Chapter 4 Adjustments, Financial Statements, and the Quality.
Chapter 3 Accrual Accounting Concepts. Why is Accrual Accounting Needed? Cash received or paid Revenue earned Expense incurred.
ADJUSTED TRIAL BALANCE
1 Chapter 4: The Mechanics of Financial Accounting.
Financial Accounting John J. Wild Seventh Edition John J. Wild Seventh Edition Copyright © 2015 McGraw-Hill Education. All rights reserved. No reproduction.
Financial Accounting Chapter 4. Adjustments, Financial Statements, and the Quality of Earnings.
Copyright © 2015 McGraw-Hill Education. All rights reserved. Chapter 2 Review of the Accounting Process.
Objective  The accounting cycle is a series of activities that begins with a transaction and ends with the closing of the books. Because the process.
Review of a Company’s Accounting System C hapter 3.
Preparing Closing Entries and a Post-Closing Trial Balance
Introduction to Accounting Preparing for a User’s Perspective
Review of the Accounting Cycle
LESSON 8-1 Recording Adjusting Entries
Gary A. Porter and Curtis L. Norton
Accrual basis of accounting
The Accounting Cycle: Step 9
The Accounting Cycle – Step 1
ADJUSTING THE ACCOUNTS
Recognition and Measurement
Debit Credit Review Questions
Chapter 1, 2, 3 Review.
Review of Accounting “Building Blocks”
Review of the Accounting Process
Presentation transcript:

General Ledger Application Small Business Information System Barry Floyd

Agenda General Ledger Application General Ledger Application Reporting Reporting Budgeting Budgeting Review of QuickBooks Review of QuickBooks Setup of a loan account Setup of a loan account Recurring transactions Recurring transactions Sending out statements Sending out statements Discussion of reports Discussion of reports Reconciliation of bank accounts (not required) Reconciliation of bank accounts (not required) ERP overview discussion ERP overview discussion

Learning Objectives Understand the notion of a “General Ledger” function Understand the notion of a “General Ledger” function Understand the interaction of the GL with the other applications Understand the interaction of the GL with the other applications See how to create transactions in QuickBooks See how to create transactions in QuickBooks Understand key reports in QuickBooks Understand key reports in QuickBooks

General Ledger Application The mainstay of an integrated set of accounting modules The mainstay of an integrated set of accounting modules Houses the Chart of Accounts Houses the Chart of Accounts Provides functionality for budgeting and reporting activities Provides functionality for budgeting and reporting activities

GL Activities Update General Ledger Accounts Update General Ledger Accounts Post adjusting entries Post adjusting entries Prepare Financial Statements Prepare Financial Statements Produce Managerial Reports Produce Managerial Reports Create budgets Create budgets

Update General Ledger Accounts Consists of posting journal entries that originate from two sources Consists of posting journal entries that originate from two sources Accounting subsystems Accounting subsystems For example, revenue cycle subsystem would generate a summary journal entry debiting accounts receivable and cash and crediting sales for all sales made during the update period. For example, revenue cycle subsystem would generate a summary journal entry debiting accounts receivable and cash and crediting sales for all sales made during the update period. Could also update accounts in real time. Could also update accounts in real time. Treasurer Treasurer Treasurer’s office creates individual journal entries to update the general ledger for nonroutine transactions such as the issuance or retirement of debt, the purchase or sale of investment securities, or the acquisition of treasury stock. Treasurer’s office creates individual journal entries to update the general ledger for nonroutine transactions such as the issuance or retirement of debt, the purchase or sale of investment securities, or the acquisition of treasury stock. Journal entries to update the general ledger may be documented on a form called a journal voucher. Journal entries to update the general ledger may be documented on a form called a journal voucher.

Post adjusting entries Adjusting entries originate from the controller’s office after the initial trial balance has been prepared. Adjusting entries originate from the controller’s office after the initial trial balance has been prepared. The trial balance is a report that lists the balance for all general ledger accounts but does not include adjusting entries The trial balance is a report that lists the balance for all general ledger accounts but does not include adjusting entries

Adjusting Entries Accruals Accruals Entries made at the end of the accounting period to reflect events that have occurred but for which cash has not yet been received or disbursed Entries made at the end of the accounting period to reflect events that have occurred but for which cash has not yet been received or disbursed Interest revenue earned, wages payable Interest revenue earned, wages payable Deferrals Deferrals Entries made at the end of the accounting period to reflect exchange of cash prior to performance of the related event. Entries made at the end of the accounting period to reflect exchange of cash prior to performance of the related event. Recognizing the portion of advance payments from customers earned during a specific period and expensing the portion of prepaid assts (e.g., rent, interest, and insurance) used in this period. Recognizing the portion of advance payments from customers earned during a specific period and expensing the portion of prepaid assts (e.g., rent, interest, and insurance) used in this period.

Adjusting Entries (continued) Estimates Estimates Entries that reflect a portion of expenses that occur over a number of accounting periods. Examples include depreciation and bad debt expenses. Entries that reflect a portion of expenses that occur over a number of accounting periods. Examples include depreciation and bad debt expenses. Revaluations Revaluations Entries made to reflect either differences between the actual and recorded value of an asset or a change in an accounting principle. Examples include change in method to value inventory, reducing the value of inventory to reflect obsolescence, etc. Entries made to reflect either differences between the actual and recorded value of an asset or a change in an accounting principle. Examples include change in method to value inventory, reducing the value of inventory to reflect obsolescence, etc. Corrections Corrections Entries made to counteract the effects of errors found in the general ledger Entries made to counteract the effects of errors found in the general ledger

Output of Adjusting Entry Process Adjusted Trial Balance Statement Adjusted Trial Balance Statement

Prepare Financial Statements Income statement Income statement Uses information from the revenue and expense account balances in the adjusted trial balance. Uses information from the revenue and expense account balances in the adjusted trial balance. Balance Sheet Balance Sheet Closing entries that zero out all revenue and expense accounts and transferring the net income or loss to retained earnings. Closing entries that zero out all revenue and expense accounts and transferring the net income or loss to retained earnings.

Reports Managers Managers Detailed information about the results of performance in their particular area of responsibility Detailed information about the results of performance in their particular area of responsibility Investors and Creditors Investors and Creditors periodic financial statements to help them assess the organization’s performance periodic financial statements to help them assess the organization’s performance

Budgeting Discussed in last class … Discussed in last class …

Summary The General Ledger is the heart of an accounting information system The General Ledger is the heart of an accounting information system It tracks all records of transactions and provides the functionality necessary for reporting. It tracks all records of transactions and provides the functionality necessary for reporting.

ERP Discussion What is ERP? What is ERP? What is ERP? What is ERP? How can ERP improve a company's business performance? How can ERP improve a company's business performance? How can ERP improve a company's business performance? How can ERP improve a company's business performance? How long will an ERP project take? How long will an ERP project take? How long will an ERP project take? How long will an ERP project take? Will ERP fix my integration problems? Will ERP fix my integration problems? Will ERP fix my integration problems? Will ERP fix my integration problems? What will ERP fix in my business? What will ERP fix in my business? What will ERP fix in my business? What will ERP fix in my business? Will ERP fit the ways I do business? Will ERP fit the ways I do business? Will ERP fit the ways I do business? Will ERP fit the ways I do business? What does ERP really cost? What does ERP really cost? What does ERP really cost? What does ERP really cost? When will I get payback from ERP—and how much will it be? When will I get payback from ERP—and how much will it be? When will I get payback from ERP—and how much will it be? When will I get payback from ERP—and how much will it be? What are the hidden costs of ERP? What are the hidden costs of ERP? What are the hidden costs of ERP? What are the hidden costs of ERP? Why do ERP projects fail so often? Why do ERP projects fail so often? Why do ERP projects fail so often? Why do ERP projects fail so often? How do I configure ERP software? How do I configure ERP software? How do I configure ERP software? How do I configure ERP software?