Accounting Study Guide by AccountingInfo.com

   Perpetual inventory system updates inventory accounts after each purchase or sale.

      Inventory subsidiary ledger is updated after each transaction.
      Inventory quantities are updated continuously.

   Periodic inventory system records inventory purchase or sale in "Purchases" account.

      "Purchases" account is updated continuously, however, "Inventory" account is updated on a periodic basis, at the end of each accounting period (e.g., monthly, quarterly)

      Inventory subsidiary ledger is not updated after each purchase or sale of inventory.
      Inventory quantities are not updated continuously.
      Inventory quantities are updated on a periodic basis.

   On May 1, 2016: Purchased 1,000 units of merchandise at $30 per unit.

Under Perpetual inventory system

5/1/2016			Debit	Credit
	Merchandise Inventory		30,000
		Accounts payable		30,000

Under Periodic inventory system

5/1/2016			Debit	Credit
	Purchases		30,000
		Accounts payable		30,000

   Under periodic inventory system, all purchases during the accounting period are recorded in the "Purchases" account.

   On May 6, 2016: Sold 200 units of merchandise at $50 per unit on credit.

Under Perpetual inventory system

5/1/2016			Debit	Credit
	Accounts Receivable		10,000
		Sales		10,000

5/1/2016			Debit	Credit
	Cost of goods sold		6,000
		Merchandise inventory		6,000

   Under perpetual inventory system, changes in merchandise inventory account are recorded after each transaction.


Under Periodic inventory system

5/1/2016			Debit	Credit
	Accounts Receivable		10,000
		Sales		10,000

   Under periodic inventory system, the following journal entry is recorded at the end of   accounting period.

5/31/2016			Debit	Credit
	Merchandise Inventory		24,000
		Purchases		24,000

   Quantity of merchandise inventory 
   = 1,000 units purchased - 200 units sold = 800 units left

   Cost of merchandise inventory
   = 800 units x $30 per unit cost = $24,000

5/31/2016			Debit	Credit
	Cost of goods sold		6,000
		Purchases		6,000

Cost of goods sold
   = Total purchases - Ending balance of merchandise inventory
   = 1,000 units x $30 per unit cost - 800 units x$30 per unit cost
   = $30,000 - $24,000 = $6,000

   On June 5, 2016: Purchased 600 units of merchandise at $35 per unit.

Under Perpetual inventory system

6/5/2016			Debit	Credit
	Merchandise Inventory		21,000
		Accounts payable		21,000

Under Periodic inventory system

6/5/2016			Debit	Credit
	Purchases		21,000
		Accounts payable		21,000

   Under periodic inventory system, all purchases during the accounting period are recorded in the "Purchases" account.


   On June 16, 2016: Sold 400 units of merchandise at $55 per unit on credit.

Under Perpetual inventory system

6/16/2016			Debit	Credit
	Accounts Receivable		22,000
		Sales		22,000

6/16/2016			Debit	Credit
	Cost of goods sold		14,000
		Merchandise inventory		14,000

   Under perpetual inventory system, changes in merchandise inventory account are recorded after each transaction.

Under Periodic inventory system

6/16/2016			Debit	Credit
	Accounts Receivable		22,000
		Sales		22,000

   Under periodic inventory system, the following journal entry is recorded at the end of   accounting period.

6/30/2016			Debit	Credit
	Merchandise Inventory		7,000
		Purchases		7,000

   Quantity of merchandise inventory 
   = 600 units purchased - 400 units sold = 200 units left

   Cost of merchandise inventory
   = 200 units x $35 per unit cost = $7,000

6/30/2016			Debit	Credit
	Cost of goods sold		14,000
		Purchases		14,000

Cost of goods sold
   = Total purchases - Ending balance of merchandise inventory
   = 600 units x $35 per unit cost - 200 units x$35 per unit cost
   = $21,000 - $7,000 = $14,000

• Accounting Changes and Error Corrections, ASC 250
• Accounting Equation
• Accounting Journal Entries
• Accounts Receivable
• Accrual Basis Accounting
• Accruals and Deferrals
• Adjusting Entries
• Asset Retirement and Environmental Obligations, ASC 410
• Assumptions of Financial Reporting
• Balance Sheet, ASC 210
• Bank Reconciliation
• Capitalized Advertising Costs, ASC 340
• Cash and Cash Equivalents
• Characteristics of Useful Information
• Classification of Assets
• Classification of Inventory
• Classification of Liabilities
• Classified Balance Sheet
• Classified Balance Sheet Practice
• Closing Journal Entries
• Codification of U.S. GAAP, ASC 105
• Compensation: Stock Compensation, ASC 718
• Components of Stockholders' Equity
• Comprehensive Income, ASC 220
• Contingencies, ASC 450
• Cost Flow Assumptions
• Cost Method Investments, ASC 325
• Cost of Inventory
• Debits and Credits
• Defined Benefit Plans: Pension, ASC 715
• Depreciation Methods
• Disposal of Property, Plant and Equipment
• Distinguishing Liabilities from Equity, ASC 480
• Earnings per Share, ASC 260
• Elements of Balance Sheet
• Elements of Financial Statements
• Elements of Income Statement
• Equity Method, ASC 323
• Exit or Disposal Cost Obligations, ASC 420
• Extraordinary and Unusual Items, ASU 2015-01
• Forms of Business Organizations
• Gain Contingencies, ASC 450
• Generally Accepted Accounting Principles (GAAP)
• Generally Accepted Accounting Principles, ASC 105
• Goodwill and Other, ASC 350
• Income Statement, ASC 225
• Income Statement, Extraordinary and Unusual Items, ASC 225
• Intangibles Other than Goodwill, ASC 350
• Interim Reporting, ASC 270
• Internal Use Software, ASC 350
• Inventory Analysis
• Inventory Recording Systems
• Inventory, ASC 330
• Investments in Debt and Equity Securities
• Investments: Debt and Equity Securities, ASC 320
• Investments: Equity Method and Joint Ventures, ASC 323
• Liquidity and Solvency Ratios
• Loss Contingencies, ASC 450
• Lower of Cost or Market (LCM)
• Multiple Step Income Statement Practice
• Net Income
• Noncurrent assets
• Nonoperating Income and Expenses
• Notes Receivable
• Offsetting, ASC 210
• Operating Expenses
• Overview of Investments in Other Entities, ASC 320
• Owners Equity Journal Entry Example 21
• Presentation of Financial Statements, ASC 205
• Presentation of Financial Statements, Discontinued Operations, ASC 205
• Profitability and Activity Ratios
• Property, plant and equipment (PP&E)
• Property, Plant and Equipment, ASC 360
• Real Estate Sales, ASC 360
• Receivables
• Research and Development Arrangements, ASC 730
• Research and Development Costs
• Research and Development, ASC 730
• Revenue Recognition, ASC 605
• Revenue Recognition: SEC Staff Accounting Bulletin Topic 13, ASC 605
• Statement of Cash Flows, ASC 230
• Steps of Accounting Cycle
• Stock Dividends, Stock Splits, ASC 505
• The Objective of Accounting
• Transfers of Securities: Between Categories, ASC 320
• Treasury Stock, ASC 505
• Types of Business Activities
• Types of Financial Statements
• Users of Accounting Information
• Website Development Costs, ASC 350
• Where can I find the text of IFRS standards?

Principles of Accounting:  

This section provides study guides for students in the principles of accounting courses or introduction to financial accounting courses. 

U.S. GAAP Codification of Accounting Standards
GAAP Codification Updates
   
Sources of U.S. GAAP
U.S. GAAP by Topic
Hierarchy of U.S. GAAP 

Principles of Accounting Course Review
Intermediate Accounting Course Review
Advanced Accounting Course Review

Financial Statements
Examples of Financial Statements
Balance Sheet: Examples

Ratios for Financial Statement Analysis

Liquidity Analysis Ratios

Profitability Analysis Ratios Activity Analysis Ratios

Cash Flow Analysis Ratios

Capital Structure Analysis Ratios

Capital Market Analysis Ratios
 
Balance Sheet
Income Statement
Statement of Cash Flows

Basics of Journal Entries
Accounting Journal Entry Examples

More Examples of Journal Entries
 
Accounting Equation
Double Entry Recording of Accounting Transactions
Debit Accounts
Credit Accounts

Asset Accounts
Liability Accounts
Equity Accounts
Revenue Accounts
Expense Accounts

Accounting Cycle

Journals and Ledgers

Adjusting Journal Entries

Trial Balance

Accrual Basis vs. Cash Basis Accounting
Accrual Basis Accounting

Cash Basis Accounting

Accrual Basis Accounting

Revenue recognition

Expense recognition
  
Bank Reconciliation 
Accounts Receivable
Inventory Accounting 
Depreciation Methods 

Present Value, Future Value (PV, FV Conversion Tables)


Simple and Compound Interest Calculations

Accounting for General Users:  
 
A guide to accounting for users who are interested in understanding accounting reports.  This section explains what users need to know to understand and analyze accounting information provided in the financial statements.  No prerequisite is required to read this section.  

CPA and Accounting Profession

How to become a Certified Public Accountant (CPA)

Accounting is an information system.

Users of accounting information

Financial accounting for external users

Managerial accounting for internal users

Examples of Financial Statements
Financial Statements Index

Balance Sheet: Examples
Balance Sheet

Income Statement

Statement of Cash Flows

Statement of Stockholders' Equity

Annual Report Project Resources

Elements of Financial Statements (SFAC No. 6)

Balance Sheet provides information about financial position of a company.

Examples of Asset Accounts

Examples of Liability Accounts

Examples of Stockholders' Equity Accounts

Income Statement provides information about the performance of a company.

Earnings Per Share (EPS)
Revenue Recognition Principle
Examples of Revenue and Gain Accounts
Examples of Expense and Loss Accounts

Statement of Cash Flows provides information about the cash flow of a company.

Cash flow from operating activities

Cash flow from investing activities

Cash flow from financing activities

Intermediate Accounting:  

This section provides study guides for students in the intermediate accounting courses.  Following topics are discussed in this section.

Accounting Courses Online
 
Accounting for Cash and Receivables

Cash and bank deposits

Accounts receivable

Notes receivable

Allowance for doubtful accounts
Impairment of a Loan

Accounting for Inventories

First In First Out (FIFO)

Last In First Out (LIFO)

Dollar Value LIFO

Retail Inventory Method

Gross Profit Method

Lower of Cost or Market (LCM)

Investments in Debt and Equity Securities

Trading securities

Available for sale securities

Debt securities

Property, Plant, and Equipment (PP&E)

Acquisition costs of noncurrent operating assets

Retirement of noncurrent operating assets
Capitalization of interest cost
Impairment of Long-Lived Assets

Goodwill and Other Intangible Assets

Loss and Gain Contingencies
Extraordinary Gains and Losses
Discontinued Operations

Earnings per Share (Basic and Diluted EPS)

Depreciation Methods

Straight Line Depreciation

Declining Balance Method

Sum-of-the-years-digits Method

Accounting for Bonds Payable

Price of bonds payable

Discount on bonds payable

Premium on bonds payable

Amortization of discount and premium

Early extinguishment of debts

Stockholders' Equity

Common stock

Preferred stock

Par value

Additional paid-in capital

Retained earnings

Treasury stock (Cost method, par value method)

Dividends (Cash dividend, Stock dividend)

Stock split

Initial Public Offering (IPO)
Subsequent Events

Code of Professional Conduct for Accountants

Advanced Accounting:  

This section provides study guides for students in the advanced accounting courses.  Following topics are discussed in this section. 

Consolidated Financial Statements
Business Combinations
Accounting for Leases