WRITTEN ACTIVITY 7: The Accounting Cycle

A-331 Group 3

Cabigting, Kyla Anne Jouey D.

Mariano, Freen B.

Nicodemus, Daena D.

Pineda, Geline R.

Rodriguez, Zyra Denelle M.

Timaio, Jassiren D.
1. Identify and differentiate the Chart of Accounts in SAP Business One.
The Chart of Accounts in SAP Business One is an index of all the General Ledger
accounts used by your business consisting several drawers and layers such as: Assets;
Liabilities; Equity for Capital and Reserves; Revenues for Turnover; Cost of Sales;
Expenses or Operation Costs; Financing for Non-Operating Income and Expenditure;
and Other Revenues and Expenses for Taxation and Extraordinary Items. Assets,
Liabilities and Equity hold the Balance Sheet Accounts. They also reflect the monetary
value of the company which consists of the assets, debt, stocks, et cetera. The other
five drawers hold the Profit and Loss Accounts such as Income Accounts, in some
localizations, they are not all profit and loss account drawers. The balance of these
accounts are cleared at the end of the fiscal year using the process of Period End
Closing. They also reflect the changes in company value such as when inventory is
sold.
2. What is a posting period? What are the different sub-periods available and the
frequency of reporting of each?
A posting period is what splits the fiscal year into sub-periods. They are periods of
time that define the fiscal year of the company. They are used in generating financial
reports and also in segmenting the financial postings. In SAP Business One, there are
four available sub-periods, namely: Year (one sub-period), Quarters (four sub-periods),
Months (twelve sub-periods), and Days (any number of sub-periods). This means that
the frequency of reporting once a year for Year, four times a year for Quarters, twelve
times a year for months, and for Days it could be any number of sub-periods that you
assign.
3. What are the different ways to post a journal entry in SAP Business One?
When posting a journal entry in SAP Business One, it is actually automatically
posted from many documents such as A/P invoices and A/R invoices. You may also
manually post a journal entry to a G/L account or even to a business partner sub-ledger
account. You may post a journal entry by entering a manual journal entry, from a journal
voucher, using a recurring posting, or by using a posting template. When recording
manually, you go to Financials > Journal Entry > Remarks field, add a brief description >
G/L Account field, Pick List > Select the Account affected in the List of Accounts >
Choose > Input amount on debit or credit side depending on the transaction > Add.
4. Identify and differentiate the types of recurring postings available on SAP
Business One.
There are four types of recurring postings: first is Daily, Weekly, Monthly, Quarterly,
Half-Yearly, Annually in which you must specify the next execution date for these
entries. Second is One time where although one-time seems a bit odd, it serves a
special purpose, this can schedule a journal entry for a specific date. Third is Template
where journal entries that you need repeated but not on a regular basis can be created
as this type, you can access these templates from the manual journal entry, and to do
so, you must specify Recurring Posting in the Template Type field. Last is Not executed
yet where if you do not need the recurring posting at present, you can turn it off with this
entry.
5. Identify different financial reports that can be generated in SAP Business One
In SAP Business One, the financial reports appear in the Financial Reports menu
under the Financials module in which they consist of: a) Balance sheet which presents
the financial position of a business and the company’s value for a certain period. It
presents the assets, liabilities, and equity; b) Trial Balance which is a summary of all the
accounts and/or business partner balances. It can comprise a particular cross section of
business partners and accounts; c) Profit and Loss Statement which shows the profit or
the loss of the company during the period and explains the change in the value of the
company; d) Statement of Cash Flow which is a legal document required by many
localizations in which it shows the inflows and outflows of cash in the company.
6 Identify and differentiate the types of financial statement analysis.
Trend Analysis, Common Size Financial Statement Analysis, and Benchmarking are
the different types of financial statement analysis in SAP Business One. Trend analysis
is also called time series analysis and it helps the financial manager of the firm to
determine how the firm likely is to perform overtime based on trends that occurred in the
past. Common size financial statement analysis involves analyzing the balance sheet
and income statement by the use of percentages. All income statement line items are
stated as a percentage of sales. All balance sheet line items are stated as a percentage
of total assets. In Benchmarking, it involves comparing a company to other companies
in the same industry in which what is seen is how one company is doing financially as
compared to the other companies in the industry. It is also called industry analysis.