06 Cash to Accrual and Single Entry Flashcards
System of record-keeping in which transactions are not analyzed and recorded in a double entry framework.
Single Entry System
How do you determine net income or loss in single entry method?
Compare capital or RE beginning and end after removing effects of drawings or dividiends and additional investments.
System that recognized revenue when cash is received and expenses when cash is paid.
Cash basis of accounting
How to solve for net sales using T-account?
T-Acc: Receivables/Advance Payments
Debit side:
AR, beg
NR, beg
Advances, end
Recovery
Credit side:
AR, end
NR, end
Advances, beg
SRA - except cash refunded
Sales disc
Writeoff
Collections
Solve for: Sales on account
Net Sales = Cash Sales + Sales on account - SRA (whole amount) - Sales disc
How to solve for bad debts expense using T-account?
T-Account: ADA
Debit side:
ADA, end
Writeoff
Credit side:
ADA, beg
Recovery
How to solve for net purchases using T-account?
T-Account: AP/NP
Debit side:
AP, end
NP, end
Advances to suppliers, beg
Purchase R&A (except cash refunded)
Purchase discount
Payment
Credit side:
AP, beg
NP, beg
Advances to suppliers, end
Solve for: Purchases on account
Net purchases = Cash Purch + Purch on account - Purch R&A - Purch Disc
How to solve for COGS using T-account?
T-Account: Inventory
Debit side:
Invty, beg
Cash purchases
Purchase on account
Credit side:
Invty, end
Purch R&A (except cash-settled)
Purch disc
How to solve for income using T-account?
T-Account: Receivable/Unearned Income
Debit side:
Receivable, beg
Unearned income, end
Credit side:
Receivable, end
Unearned income, beg
Collection of payment
How to solve for expenses using T-account?
T-Account: Prepaid asset/Payable
Debit side:
Prepaid asset, beg
Payable, end
Payment
Credit side:
Prepaid asset, end
Payable, beg
