book

Accounting All-in-One For Dummies, with Online Practice, 2nd Edition

Name: Accounting All-in-One For Dummies, with Online Practice, 2nd Edition
Author: Joseph Kraynak
ISBN: 9781119453895

by Joseph Kraynak

April 2018

Beginner

768 pages

20h 9m

English

For Dummies

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Cover
Introduction
About This BookFoolish AssumptionsIcons Used in This BookBeyond the BookWhere to Go from Here
Book 1: Setting Up Your Accounting System
Chapter 1: Grasping Bookkeeping and Accounting Basics
Knowing What Bookkeeping and Accounting Are All AboutWrapping Your Brain around the Accounting CycleWorking the Fundamental Accounting Equation
Chapter 2: Outlining Your Financial Road Map with a Chart of Accounts
Getting to Know the Chart of AccountsSetting Up Your Chart of AccountsMulling Over Debits versus CreditsUnderstanding Double-Entry Accounting
Chapter 3: Using Journal Entries and Ledgers
Keeping a JournalBringing It All Together in the LedgerPutting Accounting Software to Work for You
Chapter 4: Choosing an Accounting Method
Distinguishing between Cash and Accrual BasisSorting through Standards for Other Types of AccountingConsidering the Conceptual Framework of Financial Accounting
Book 2: Recording Accounting Transactions
Chapter 1: Keeping the Books
Analyzing the Effect of Business TransactionsManaging Your Bookkeeping and Accounting SystemWrapping Up with End-of-Period Procedures
Chapter 2: Tracking Purchases
Keeping Track of InventoryBuying and Monitoring SuppliesStaying on Top of Your Bills

Chapter 3: Counting Your Sales
Collecting on Cash SalesSelling on CreditProving Out the Cash RegisterTracking Sales DiscountsRecording Sales Returns and AllowancesMonitoring Accounts ReceivableAccepting Your Losses
Chapter 4: Processing Employee Payroll and Benefits
Staffing Your BusinessCollecting Employee TaxesDetermining Net PaySurveying Your Benefits OptionsPreparing Payroll and Posting It in the BooksDepositing Employee Taxes
Chapter 5: Computing and Reporting Payroll Taxes
Paying Employer Taxes on Social Security and MedicareCompleting Unemployment Reports and Paying Unemployment TaxesCarrying Workers’ Compensation InsuranceMaintaining Employee Records
Book 3: Adjusting and Closing Entries
Chapter 1: Depreciating Your Assets
Defining DepreciationEvaluating Your Depreciation OptionsTackling Taxes and Depreciation
Chapter 2: Paying and Collecting Interest
Deciphering Types of InterestHandling Interest IncomeDelving into Loans and Interest Expenses
Chapter 3: Proving Out the Cash
Why Prove Out the Cash?Making Sure Ending Cash Is RightClosing the Cash JournalsUsing a Temporary Posting Journal
Chapter 4: Reconciling Accounts and Closing Journal Entries
Reconciling Bank AccountsPosting Adjustments and CorrectionsPrepping to Close: Checking for Accuracy and Tallying Things UpPosting to the General LedgerChecking Out Computerized Journal Records
Chapter 5: Checking Your Accuracy
Working with a Trial BalanceTesting Your Balance by Using Computerized Accounting SystemsDeveloping a Financial Statement WorksheetReplacing Worksheets with Computerized Reports
Chapter 6: Adjusting the Books
Adjusting All the Right AreasTesting an Adjusted Trial Balance
Book 4: Preparing Income Statements and Balance Sheets
Chapter 1: Brushing Up on Accounting Standards
Exploring the Origins of Accounting StandardsRecognizing the Role of the American Institute of Certified Public Accountants (AICPA)Checking Out the U.S. Securities and Exchange Commission (SEC)Getting to Know the Financial Accounting Standards Board (FASB)
Chapter 2: Preparing an Income Statement and Considering Profit
Understanding the Nature of ProfitChoosing the Income Statement FormatDeciding What to Disclose in the Income StatementExamining How Sales and Expenses Change Assets and LiabilitiesConsidering the Diverse Financial Effects of Making a ProfitReporting Extraordinary Gains and LossesCorrecting Common Misconceptions about Profit
Chapter 3: Assessing the Balance Sheet’s Asset Section
Homing in on Historic CostDiscovering What Makes an Asset CurrentKeeping Track of Noncurrent (Long-Term) AssetsExploring the Asset Section of the Balance Sheet
Chapter 4: Digging for Debt in the Balance Sheet’s Liabilities Section
Seeing How Businesses Account for LiabilitiesKeeping Current Liabilities under ControlPlanning for Long-Term ObligationsAccounting for Bond Issuances
Chapter 5: Explaining Ownership in the Equity Section of the Balance Sheet
Understanding How Owner Equity Varies among Business EntitiesDistinguishing between Two Types of Capital StockDefining Paid-In CapitalRecording Retained EarningsSpotting Reductions to Stockholders’ EquityExploring Stock SplitsComputing Earnings per Share
Chapter 6: Coupling the Income Statement and Balance Sheet
Rejoining the Income Statement and Balance SheetIntroducing Operating RatiosAdding Fixed Assets, Depreciation, and Owners’ EquityCompleting the Balance Sheet with Debt
Book 5: Reporting on Your Financial Statements
Chapter 1: Presenting Financial Condition and Business Valuation
Clarifying the Values of Assets in Balance SheetsIntroducing Business ValuationComparing Business Valuation Methods
Chapter 2: Laying Out Cash Flows and Changes in Equity
Understanding the Difference between Cash and ProfitRealizing the Purpose of the Statement of Cash FlowsWalking through the Cash Flow SectionsRecognizing Methods for Preparing the Statement of Cash FlowsInterpreting the Statement of Cash FlowsLooking Quickly at the Statement of Changes in Stockholders Equity
Chapter 3: Analyzing Financial Statements
Judging Solvency and LiquidityUnderstanding That Transactions Drive the Balance SheetMeasuring ProfitabilityExploring Activity MeasuresComparing Horizontal and Vertical AnalysisUsing Common Size Financial Statements
Chapter 4: Reading Explanatory Notes and Disclosures
Realizing How Corporations Should Govern ThemselvesIdentifying Corporate CharacteristicsReviewing Common Explanatory NotesPutting the Onus on the Preparer
Chapter 5: Studying the Report to the Shareholders
Why Private and Public Companies Treat Annual Reports DifferentlyFulfilling Three PurposesReading the Annual Report to ShareholdersWalking through Form 10-K
Book 6: Planning and Budgeting for Your Business
Chapter 1: Incorporating Your Business
Securing Capital: Starting with OwnersRecognizing the Legal Roots of Business EntitiesIncorporating a Business
Chapter 2: Choosing a Legal Structure for a Business
Differentiating between Partnerships and Limited Liability CompaniesGoing It Alone: Sole ProprietorshipsChoosing the Right Legal Structure for Income Tax
Chapter 3: Drawing Up a Business Plan to Secure Cash
Outlining the Basic Business PlanDeveloping a Business PlanIncorporating Third-Party Information into Your Plan
Chapter 4: Budgeting for a Better Bottom Line
Brushing Up on Budgeting BasicsRecognizing Factors That Impact Your Budgeting ProcessThe Nuts and Bolts of Budgeting
Chapter 5: Mastering and Flexing Your Budgeting
Budgeting with Cash or Accrual AccountingBudgeting to Produce the Income Statement and Balance SheetFlexing Your Budget: When Plans Change
Chapter 6: Planning for Long-Term Obligations
Managing Long-Term DebtAccounting for Bonds
Book 7: Making Savvy Business Decisions
Chapter 1: Estimating Costs with Job Costing
Understanding How Job Costing WorksTaking a Closer Look at Indirect Costs by Using Normal CostingFollowing the Flow of Costs through a Manufacturing System
Chapter 2: Performing Activity-Based Costing
Avoiding the Slippery Slope of Peanut Butter CostingDesigning an Activity-Based Costing SystemUsing Activity-Based Costing to Compute Total Cost, Profit, and Sale Price
Chapter 3: Examining Contribution Margin
Computing Contribution MarginPreparing a Cost-Volume-Profit AnalysisGenerating a Break-Even AnalysisShooting for Target ProfitObserving Margin of SafetyTaking Advantage of Operating Leverage
Chapter 4: Accounting for Change with Variance Analysis
Setting Up Standard CostsUnderstanding VariancesTeasing Out Variances
Chapter 5: Making Smart Pricing Decisions
Differentiating ProductsTaking All Costs into Account with Absorption CostingPricing at Cost-PlusExtreme Accounting: Trying Variable-Cost PricingBull’s-Eye: Hitting Your Target Cost
Chapter 6: Using Financial Formulas
Analyzing ProfitabilityUsing Assets EffectivelyEvaluating Firm LiquidityChecking on Company Solvency
Book 8: Handling Cash and Making Purchase Decisions
Chapter 1: Identifying Costs and Matching Costs with Revenue
Defining Costs and Expenses in the Business WorldSatisfying the Matching PrincipleIdentifying Product and Period CostsDiscovering Which Costs Are DepreciatedPreparing a Depreciation ScheduleDeciding When to Recognize Revenue
Chapter 2: Exploring Inventory Cost Flow Assumptions
Discovering How Inventory Valuation Affects the Financial StatementsLogging Inventory for Service CompaniesClassifying Inventory TypesGetting to Know Inventory Valuation MethodsPreparing an Inventory Worksheet
Chapter 3: Answering the Question: Should I Buy That?
Identifying Incremental and Opportunity CostsKeeping It Simple: The Cash Payback MethodIt’s All in the Timing: The Net Present Value (NPV) MethodMeasuring Internal Rate of Return (IRR)Considering Qualitative Factors
Chapter 4: Knowing When to Use Debt to Finance Your Business
Understanding the Basics of Debt CapitalDetermining When Debt Is Most AppropriateUsing Loans, Leases, and Other Sources of DebtGetting Creative with Capital
Chapter 5: Interpreting Your Financial Results as a Manager
Gauging the Relative Importance of InformationReviewing Profit and EarningsJudging the Company’s Cash PositionTackling Extraordinary Gains and LossesRecognizing the Risks of RestatementRemembering the Limits of Financial Reports
Chapter 6: Handling the Financial End of a Business Sale
Maximizing Business ValueBecoming a Team PlayerFunding a Business PurchaseWorking through Due DiligenceComing to Terms with a Sale Price
Book 9: Auditing and Detecting Financial Fraud
Chapter 1: Mulling Over Sarbanes-Oxley Regulation
Pre-SOX Securities LawsThe Scope of SOX: Securities and IssuersThe Post-SOX Paper Trail
Chapter 2: Preventing Cash Losses from Embezzlement and Fraud
Setting the Stage for ProtectionPutting Internal Controls to WorkRecognizing Limitations of Internal Controls
Chapter 3: Assessing Audit Risk
Using the Audit Risk ModelFollowing Risk Assessment ProceduresFiguring Out What’s Material and What Isn’tEvaluating Your Audit Risk Results
Chapter 4: Collecting and Documenting Audit Evidence
Management Assertions: Assessing the Information a Client Gives YouEyeing the Four Concepts of Audit EvidenceApplying Professional JudgmentUsing Your Audit Program to Request the Right EvidenceDocumenting the Audit Evidence
Chapter 5: Auditing a Client’s Internal Controls
Defining Internal ControlsIdentifying the Five Components of Internal ControlsDetermining When You Need to Audit Internal ControlsTesting a Client’s Reliability: Assessing Internal Control ProceduresLimiting Audit Procedures When Controls Are StrongTailoring Tests to Internal Control WeaknessesTiming a Client’s Control Procedures
Chapter 6: Getting to Know the Most Common Fraud Schemes
Frauds Committed by BusinessesFrauds Committed against Businesses
Chapter 7: Cooked Books: Finding Financial Statement Fraud
Exploring the Financial Statement Fraud TriangleSpotting the Common Methods of FraudUncovering Financial Statement Fraud
About the Authors
Connect with Dummies
Index
End User License Agreement

Content preview from Accounting All-in-One For Dummies, with Online Practice, 2nd Edition

Chapter 1

Brushing Up on Accounting Standards

IN THIS CHAPTER

Looking back at the origins of financial accounting standards

Introducing the accountant’s code of conduct (set by the AICPA)

Reviewing rules set by the Financial Accounting Standards Board (FASB)

Finding out about generally accepted accounting principles (GAAP)

Although accountants often ply their trade as freelancers, accounting isn’t a free-for-all. Accountants are expected to operate according to a professional code of conduct and practice generally accepted accounting principles (GAAP) — best practices for accounting in the United States.

This chapter begins with a whirlwind tour through the history of accounting that highlights the origins of accounting standards. Following this brief historical account is an overview of the financial accounting code of professional conduct, which is set by the American Institute of Certified Public Accountants (AICPA). These standards give you a roadmap to follow when you’re trying to figure out how to interact with your clients or employer. The standards also explain how to handle ...

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Accounting All-in-One For Dummies, with Online Practice, 2nd Edition

by Joseph Kraynak

Brushing Up on Accounting Standards

Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.