Accounting

1.Accounting equation: Asset = Liability + Owner’s Equity

2.Double entry accounting: debit (Dr) & credit (Cr)

3.Historical cost, fair value, replacement cost, net realizable value, present value

4.Financial statement

Balance sheet

Assets: cash, tradable financial assets, note receivable, accounts receivable (provision for bad/doubtful debts), prepaid accounts/prepayments/advances to suppliers, dividend receivable, interest receivable, other receivables, inventory; available-for-sale financial assets, hold-to-maturity investment, long-term accounts/note receivable, long-term equity investment, fixed assets (accumulated depreciation, impairment of fixed assets), disposal of fixed assets, construction-in-process (impairment of CIP), intangible assets (accumulated amortization, impairment), investment real estate, development expenditure, goodwill, deferred income tax assets, etc.

Liabilities: short-term loan, tradable financial liability, employ compensation payable, taxes and dues payable, interest payable, dividend payable, non-current liabilities due within one year/current portion of non-current debt, accounts payable, note payable, unearned revenue/advances from customers, long-term loan, long-term payables, bonds payable, etc.

Equity: paid-in capital/capital stock, capital reserves, treasury stock, surplus reserves, retained earnings

Income statement

Revenue: sales (sales discount, allowance & returns, net sales), other operating income

Operating costs: cost of goods sold/sales, other operating cost

Sales tax and extra charges

Operating expenses: selling expenses, (general and) administrative expenses, interest expenses (financial expenses), impairment loss

Operating income

Non-operating income & expenses

Total profit

Income taxes

Net income/profit

Statement of cash flows

cash flow from operating activities: direct method and indirect method

cash flow from investing activities

cash flow from financing activities

5.Cash

Cash in bank

Bank reconciliation

6.Receivables

Accounts receivables, notes receivables, other receivables

Uncollectible receivables: factoring

Allowance method: allowance for doubtful accounts

Estimate based on a percentage of sales

Estimate based on analysis of receivables

The direct write-off method