UNIVERSITY OF INFORMATION TECHNOLOGY A& SCIENCES Department of School of Business Term Paper

On Full Accounting Processes.

Course Code: ACT- 141 Course Title: Principles of Accounting Submitted By: Sk. Zahidur Rahman Ashikul Abedin Sk. Sazzadur Rahman Md. Nahid hassan Md. Shahadat Hossain Noornabi Bappi Md. Shahriar Ahmed Submitted To: Md.Nazmul Islam Lecturer Faculty, School of Business University of Information Technology & Sciences 09310044 09310137 09310045 09310030 09310010 09310051 08510120

Date of Submission: August 9, 2009

Letter of Transmittal 9th August, 2009 To Arif Rana Dean Faculty, School of Business University of Information Technology & Sciences Subject: Submission of Term Paper on Full Accounting Processes. Dear Sir, It is a great pleasure for us to submit here with the summer 2009 ACT-141 Term Paper, which you have authorized us to prepare and submit by December 03, 2009 as ACT-141 course requirement. This particular report has given us the opportunity to acquire various information and knowledge regarding all accounting statements in modern organizations. We are tremendously thankful to you for giving us the opportunity to learn the practical skills during the course. You would be glad to hear that we have given our best effort to prepare this term paper with relevant information and tried to present all the statements. In spite of various shortcomings like limitations of our knowledge and time constraint we have tried to cover all relevant affairs, we think this Term Paper will be able to meet up your expectation.

Sincerely, Sk. Zahidur Rahman Ashikul Abedin Sk. Sazzadur Rahman Md. Nahid hassan Md. Shahadat Hossain Noornabi Bappi Md. Shahriar Ahmed 09310044 09310137 09310045 09310030 09310010 09310051 08510120

Department of School of Business University of Information Technology & Sciences.

Objective of the Term Paper: The principal intent of this Term Paper is to learn about the overall role importance and functions of an accountant in an modern organization. Therefore the object of the study is as follows: i. ii. iii. iv. To gather theoretical and practical knowledge of present Accounting system and types of accountants in modern organizations. To have a glance various roles of accountants and their impact. To learn the prevailing laws rules and regulations of related to accountants in a company To learn about the policy and principles applied by government in operating as an accountant in an organization.

Scope of the paper: This Term Paper has been prepared through discussion with accountants of banks, multinational companies, and shops and other modern organization employees, clients and honorable supervisors. While preparing this Term Paper, We had a great opportunity to have an in depth knowledge of all the accounting activities practice by accountants in modern organizations. It also helped us to acquire a first hand perspective of leading Accountants in private banks and other organizations in Bangladesh. We have also an idea of the Accounting sectors importance in Modern organizations.

Limitation: Time is impartment issue in Term Paper writing. Schedule time span was not sufficient to carry out a Term Paper of this big magnitude. Due to knowledge constraint many aspects cant be presented in this Term Paper properly.

Methodology:

The study required much information and theoretical aspects regarding Accounting systems, modern organizations and types of accountants. To do all these things we needed much information. We have collected these information form both primary and secondary sources.

(a) Primary sources: Direct observation Face to face conversation with both the accountants, employees and clients of some modern organizations.

(b) Secondary Sources: Required information was collected mainly from the secondary sources. The sources are:

Articles and books related to Accounting systems Hand note given by honorable speaker. Data collected from the Internet Course materials of Act-141

Necessary information was segregate from the source material and collected information were compiled and processed to prepare this Term Paper.

Acknowledgement
We have prepared our term paper on: Full Accounting Process It was really a nice experience for us to do the term paper on above topic. At the very outset, we would like to express our deep gratitude to almighty Allah. Next, to our honorable Course instructor Arif Rana(Dean of School of Business, University of Information Technology & Sciences) for providing us valuable guidance, encouragement and suggestions during the time of our study. Without his guidance this term paper would not have been possible to complete and submit properly. In this Term Paper we have tried our best to make the study successful with what we have learnt about the accounting procedures from different data collected from various sources. We confess there might be sour mistakes, some adolescent efforts. It will drive happiness if we find our whole efforts serve, at least to some extent for which it has been prepared.

Finally, we want to express our gratitude to all the members of our family and our friends who have always inspired us in all of our endeavors. Their support has always been a source of inspiration for us.

Sincerely, Group -1

Department of School of Business University of Information Technology & Sciences

Full Accounting Process

For the Month of October, 2009, the following transactions take place in ABC Solutions, a new business:

1) Owner invests $20,000 into business 2) Buy equipment $10,000 on account 3) Buy supplies for cash $800 4) Sell on account $1500 5) Receive payment for consulting service in advance $3000 6) Pay 8 months membership in advance $400 7) Pay salaries $300 8) Pay for utilities $250 9) Owner withdraws $600 for personal use 10)Open a bank account by $5000 deposit 11) Pay chaque of $3000 relating to transaction 2 12) Receive $400 relating to transaction 4 The following information is also available at the month end:a) Equipment depreciation is $150 per month b) At the month end, $350 of salaries were unrecorded c) Inventory of supplies is $ 240 d) Relating to transaction 5, $1000 service have been provided e) There is accrued revenue of $300 Required: Journals, ledgers, Trial balance, Statement of retained earning, Financial reports, Reciepts and payments, cash flow statement.

Journals
ABC Solutions Oct-09 Ref Description 1) Cash Capital 2) Equipment Accounts Payable 3) Supplies PP Cash 4) Accounts Receivable Revenue 5) Cash Unearned Revenue 6) Membership PP Cash 7) Salary Expense Cash 8) Utilities Exp DR 20000 10000 10000 800 800 1500 1500 3000 3000 400 400 300 300 250 CR 20000

Cash 9) Withdrawals Cash 10) Bank Cash 11) Accounts Payable Bank 12) Cash Accounts Receivable a) b)

250 600 600 5000 5000 3000 3000 400 400 150 350 560 560 1000 1000 300 300 50 50 2800 2800 650 650 250 250 150 150 560 560 50 50 1140 1140 600 600

Depreciation Expense 150 Accumulated Depreciation Salary Expense Salary Payable Supplies Expense Supplies PP Unearned Revenue Revenue Accounts Receivable Revenue Membership Expense PP Membership Revenue Income Summary Income Summary Salary Expense Income Summary Utilities Expense Income Summary Depreciation Expense Income Summary Supplies Expense Income Summary Membership Expense Income Summary Capital Capital Withdrawals 350

c) d) e) A6) C1) C2) C3) C4) C5) C6) C7) C8)

Cash Book Receipts Ref. No. 1 5 11 Description Capital Unearned Revenue A/C receivable Cash 20,000 3,000 400 23,400 Payments
3 Supplies PP Membership PP Salary Expense Utilities Expense Withdrawals Bank 800 400 300 250 600 5,000 16,050

6 7
8 9 10

Ending Cash Balance

Bank Book Receipts Ref. No. 10 Payments 11 Description Cash A/C Payable Bank 5000 (3000)

Ending Bank Balance

2000

Ledger
ABC Solutions Oct-09 Assets Cash Ref 1 3 5 6 7 8 9 10 11 Bank Ref 10 11 Description Cash Accounts Payable DR 5000 CR 3000 Bals 5000 2000 Description Capital Supplies PP Unearned Revenue Membership PP Salary Expense Utilities Expense Withdrawals Bank Accounts Receivable DR 20000 3000 400 300 250 600 5000 400 CR 800 Bals 20000dr 19200dr 22200dr 21800dr 21500dr 21250dr 20650dr 15650dr 16050dr

Equipment Ref Description 2Accounts Payable DR CR 10000 Bals 10000dr

Accumulated Depreciation Ref Description A1 Depreciation Expense Supplies PP Ref Description 3Cash A3 Supplies Expense Accounts Receivable Ref Description 4Revenue 11Cash A5 Revenue Membership PP Ref Description 6Cash A6 Memebership Expense

DR

CR 150

Bals 150cr

DR 800

CR 560

Bals 800dr 240dr Bals 1500dr 1100dr 1400dr Bals 400dr 350dr

DR 1500 300 DR 400

CR 400

CR 50

Liabilities Accounts Payable Ref Description 2Equipment 10Bank DR 3000 DR CR Bals 10000 10000cr 7000cr CR 350 CR 3000 Bals 350cr Bals 3000cr 2000cr

Salary Payable Ref Description A2 Salary Expense Unearned Revenue Ref Description 5Cash A4 Revenue Equity Capital Ref Description 1Cash C7 Income Summary C8 Withdrawals

DR 1000

DR 600

CR Bals 20000 20000cr 1140 21140cr 20540cr

Withdrawals Ref Description 9Cash C8 Capital Income Summary Ref Description C1 Revenue C2 Salary Expense C3 Utilities Expense C4 Depreciation Expense C5 Supplies Expense C6 Membership Expense C7 Capital Revenue Ref Description 4Accounts Receivable A4 Unearned Revenue A5 Accounts Receivable C1 Income Summary Salary Expense Ref Description 7Cash

DR 600

CR 600

Bals 600Dr

DR 650 250 150 560 50 1140 DR

CR 2800

Bals 2800cr 2150cr 1900cr 1750cr 1190cr 1140cr

CR 1500 1000 300

Bals 1500cr 2500cr 2800cr

2800 DR 300 CR Bals 300dr

A2 C2

Salary Payable Income Summary

350 650 DR 250 CR 250 DR 150 CR 150 DR 560 CR 560 DR 50 CR 50

650dr

Utilities Expense Ref Description 8Cash C3 Income Summary Depreciation Expense Ref Description A1 Accumulated Depreciation C4 Income Summary Supplies Expense Ref Description A3 Supplies PP C5 Income Summary Membership Expense Ref Description A6 PP Membership C6 Income Summary

Bals 250dr

Bals 150dr

Bals 560dr

Bals 50dr

Trial Balance
ABC Solutions Oct-09

Description Cash Bank Equipment Accumulated Depreciation Supplies PP Accounts Receivable Membership PP Accounts Payable Salary Payable Unearned Revenue Capital Withdrawals Revenue Salary Expense Utilities Expense Depreciation Expense Supplies Expense Membership Expense

DR CR 16050 2000 10000 150 240 1400 350 7000 350 2000 20000 600 2800 650 250 150 560 50 32300 32300

Post Closing Trial Balance Cash Bank Equipment Accumulated Depreciation Supplies PP Accounts Receivable Membership PP Accounts Payable Salary Payable Unearned Revenue Capital DR CR 16050 2000 10000 150 240 1400 350 7000 350 2000 20540 30040 30040

Income Statement
ABC Solutions Oct-09 Revenue Less Expense Salary Expense Utilities Expense Depreciation Expense Supplies Expense Membership Expense Total Expenses Net Income 650 250 150 560 50 1660 1140 2800

Statement Owners Equity

ABC Solutions Oct-09 Opening Balance Capital Introduced Net Income Withdrawals 0 20000 1140 21140 (600) 20540

Balance Sheet
ABC Solutions 31-Oct-09

Assets Cash Bank Equipment Accumulated Depreciation Supplies PP Accounts Receivable Membership PP Total Assets Liabilities and Equity Liabilities Accounts Payable Salary Payable Unearned Revenue

16050 2000 10000 150 9850 240 1400 350 29890

7000 350 2000

Total Liabilities Equity Capital Total Liabilities and Equity

9350 20540 29890

Statement of retained earnings

Previous retained earnings balance 0 Net profit Withdrawals Dividends Closing Retained balance 1140 (600) (540) 0

Cash flow statement using the direct method

Cash flows from (used in) operating activities Cash receipts from Revenue Less Expense 2,800 (1,660)

Net cash flows from operating activities Cash flows from (used in) investing activities Proceeds from the sale of equipment Net cash flows from investing activities Cash flows from (used in) financing activities Capital Dividends paid Withdrawals Net Flows from financing activities Net increase in cash and cash equivalents 20,000 540 600 10,000

1,240

(10,000)

18,960 10,200

Reciepts and Pyments Receipts

Bank Accounts Receivable Unearned Revenue Capital Revenue Total received 2000 1400 2000 20000 2800 28,200

Payments
Equipment Accumulated Depreciation Supplies PP Membership PP Accounts Payable Salary Payable Withdrawals Salary Expense Utilities Expense Depreciation Expense Supplies Expense Membership Expense Total Payments Closing Balance 10000 150 240 350 7000 350 600 650 250 150 560 50 20,250 7,950

-- o --