1. 会计英语

2. Chapter 14 REVENUES AND EXPENSES
了解收入和费用的概念
掌握收入的组成
掌握收入的账务处理
掌握费用的组成
掌握费用的账务处理

3. THE DEFINITION OF REVENUES AND EXPENSES
OBJECTIVE ONE

4. THE DEFINITION OF REVENUES AND EXPENSES
Revenue is the only element which can bring cash in.
Net sales = Gross sales － (Sales discounts + Sales returns and allowances)

5. THE DEFINITION OF REVENUES AND EXPENSES
B. GROCERY STORE
Partial Income Statement
For the Year Ended December 31, 2011
Operating revenues
Gross sales
$28200
Less: Sales discounts
$600
Sale returns and allowances
700
1300
Net Sales
$26900

6. THE DEFINITION OF REVENUES AND EXPENSES
Revenues-where are revenues from?
Sale of a product from inventory
Revenue from fees or service
Sales
Rendering a service
Revenue from sales
Service Revenue
Sale of an asset other than inventory
Gain or loss on disposition
Gain/loss on disposal of assets

7. THE DEFINITION OF REVENUES AND EXPENSES
Expenses are the items should be deducted from revenues to obtain net income.
Cost of goods sold
Operating expenses

8. COMPOSITION OF REVENUES
OBJECTIVE TWO

9. COMPOSITION OF REVENUES
Determining Revenues When There Are Trade Discounts
Trade discount is a percentage deduction, or discount, from the specified list price or catalog price of merchandise.
The list price less all trade discounts is the gross revenue should be recorded in the account.
List price, 200 basketball at $6
$1200
Less: Trade discount, 30%
360
Gross invoice price
$840

10. COMPOSITION OF REVENUES
Determining Revenues When There Are Sales Discounts and Sales Returns and Allowance
A cash discount is a deduction from the gross invoice price that can be taken only if the invoice is paid within a specified period of time.
A cash discount is called a sales discount by the seller and a purchase discount by the buyer.
Sales Returns and Allowances is a contra revenue account used to record the selling price of merchandise returned by buyers or reductions in selling prices granted.

11. COMPOSITION OF REVENUES
Determining Revenues When There Are Sales Discounts and Sales Returns and Allowance
Cash discount terms are often stated as follows:
2/10,n/ means a discount of 2% of the gross invoice price of the merchandise may be taken if payment is made within 10 days following the invoice date. The gross invoice price is due 30 days from the invoice date.

12. COMPOSITION OF REVENUES
Determining Revenues When There Are Sales Discounts and Sales Returns and Allowance
Assume that on July 12 a business sold merchandise for $2000 on account; terms are 2/10,n/30. a check in payment of the account was received on July 21 (nine days after invoice date) in the amount $1960. The revenue earned is computed as follows:
Sales discount=$2000×2%=$40
Revenue = 2000 – 40=1960

13. COMPOSITION OF REVENUES
Determining Revenues When There Are Sales Discounts and Sales Returns and Allowance
Assume that on July 12 a business sold merchandise for $2000 on account; terms are 2/10,n/30. a check in payment of the account was received on July 21 (nine days after invoice date) in the amount $1960. $300 of goods are returned. The revenue earned is computed as follows:
Sales discount=$2000×2%=$40
Revenue = 2000 – 40=1960
Net sales= =1660

14. ACCOUNTING PROCESS FOR REVENUES
OBJECTIVE THREE

15. ACCOUNTING PROCESS FOR REVENUES
When sales happens, the accounting process should be performed as follows:
Dr. Cash/Accounts Receivable
Cr. Sales

16. ACCOUNTING PROCESS FOR REVENUES
Accounting Process for Revenue When There Are Trade Discounts
List price, 200 basketball at $6
$1200
Less: Trade discount, 30%
360
Gross invoice price
$840
Dr. Cash
Cr. Sales

17. ACCOUNTING PROCESS FOR REVENUES
Determining Revenues When There Are Sales Discounts and Sales Returns and Allowance
Assume that on July 12 a business sold merchandise for $2000 on account; terms are 2/10,n/30. a check in payment of the account was received on July 21 (nine days after invoice date) in the amount $1960. $300 of goods are returned. The revenue earned is computed as follows:
Sales discount=$2000×2%=$40
Revenue = 2000 – 40=1960
Net sales= =1660

18. ACCOUNTING PROCESS FOR REVENUES
Accounting Process For Sales Discounts
Cash Discounts
Inducements for prompt payment
Gross Method vs Net Method

19. ACCOUNTING PROCESS FOR REVENUES
Accounting Process For Sales Discounts
Gross Method: Under this method, companies recognize sales discounts only when they receive payment within the discount period.
Net Method: Under this method, sales discounts are taken reflect penalties added to an established price to encourage prompt payment..

20. ACCOUNTING PROCESS FOR REVENUES
Accounting Process For Sales Discounts
Gross Method
Net Method
Sales of $10000, terms 2/10, n/30
Accounts Receivable
Sales
Accounts Receivable
Sales
Payment received within discount period
Cash
Sales Discount
Accounts Receivable
Cash
Accounts Receivable
Payment received after discount period
Cash
Accounts Receivable
Cash
Accounts Receivable
Sales Discount Forfeited

21. ACCOUNTING PROCESS FOR REVENUES
Determining Revenues When There Are Sales Discounts and Sales Returns and Allowance
Assume that on July 12 a business sold merchandise for $2000 on account; terms are 2/10,n/30. a check in payment of the account was received on July 21 (nine days after invoice date) in the amount $1960. $300 of goods are returned. The revenue earned is computed as follows:
July 12
Dr. Accounts Receivable
Cr. Sales
July 21
Dr. Cash
Sales Discount
Sales R&A
Cr. Accounts Receivable

22. COMPOSITION OF EXPENSES
OBJECTIVE FOUR

23. COMPOSITION OF EXPENSES
Operating expenses
Selling expenses
Sales salaries
Delivery expense
Advertising expense
etc
Administrative expenses
Salaries for office
Rent
Insurance
Cost of goods sold
COMPOSITION OF EXPENSES

24. COMPOSITION OF EXPENSES
Classify the following items into cost of goods sold, selling expenses, and administrative expenses by putting a tick in the blank. √ √ √ √ √ √ √ √

25. ACCOUNTING PROCESS FOR EXPENSES
OBJECTIVE FIVE

26. ACCOUNTING PROCESS FOR EXPENSES
For example, a company pays $7,000 office rent, in cash, for the current period.
Journal entry should be:
Dr. Rent Expense ,000
Cr. Cash ,000
The company pays employee salaries in cash of $40,000.
The journal entry should be:
Dr. Salaries Expense ,000
Cr. Cash ,000

27. PRESENTATION OF SALES AND EXPENSES IN FS
REVIEW

28. FOR THE YEAR ENDED DECEMBER 31, 2010
ABC Company
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2010
Sales Revenue
Sales
Less: Sales discount
Sales returns and allowances
Net sales revenue
Cost of Goods Sold
Operating Expenses
Selling expenses
Sales salaries expenses
Sales office salaries
Advertising expenses
Freight and transportation-out
Depreciation of sales equipment
Administrative Expenses
Officers’ salaries
Insurance expenses
Depreciation of building
Depreciation of office equipment
Net income for the year
202,644
59,200
38,315
41,209
9005
186,000
17,029
18,059
16000
$24,241
56,427
350,373
237088
$3,053,081
80668
2972,413
587461
$402,411

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