accounting for sport management

Dr.Pongsak SWATDIKIAT

การแลกเปลยนผลประโยชนซงกนและ กนระหวางบคคลตงแต2กลมขนไป

WHAT IS BUSINESS?

What are the risks(possible future

sacrifices?)

What are the rewards (possible future

benefits?)

Marketing

HumanResources

Production and OperationsB

USI

NES

S F

UN

CTI

ON

Sเนนสรางความพงพอใจ

แกลกคา โดยใช 4’P

เนนทพนกงาน : เชอมนในความสามารถ และใหโอกาสในการสรางสรรคสงใหมๆ

เนนการดาเนนงาน : วางแผนจดองคการ สงการ และควบคมการปฏบตงาน

BU

SIN

ESS

FU

NC

TIO

NS F i n a n c e

A c c o u n t i n g and Information Systems

เนนทเงน: ดแลการจดหาเงนและใชเงน เลอกลงทนเพอใหเกดผลตอบแทนทคมคา

ทสด

เนนผใชขอมล: จดเตรยมขอมลทเหมาะสมกบการ

ใชงานของฝายตางๆ ในองคกร รวมถงผใช

ภายนอกองคกร

Forms of Business Organization• Sole Proprietorship

– Single individual– Unlimited Liability

• Partnership Firms– A few individuals– Unlimited Liability

• Limited company– Numerous individuals, often strangers– Large business– Limited liability

ประเภทของธรกจ

แบงตามลกษณะการจดตง

Sole proprietorship - กจการเจาของคนเดยว ม

ฐานะเปนบคคลธรรมดา ลงทนดวยสนทรพยสวนตวหรอกยม

จากผอน

- รบผลประโยชนไปเพยงคนเดยว มความคลองตวในการ บรหารงาน

- มขอจากดเรองเงนทนจงทาใหขยายธรกจไดยาก ความรบผดชอบ ตอผเสยหายอยางเตมเปยม และการตดสนใจทอาจขาดการ

ไตรตรอง

แบงตามลกษณะการจดตง

Partnership - กจการหางหนสวน มเจาของตงแต 2 คนขนไป รวมกนลงทนและบรหารกจการ มฐานะเปนบคคล

ธรรมดา แตถานากจการไปจดทะเบยนจะมฐานะเปนนตบคคล แบงไดเปน

- หางหนสวนสามญ

+ หางหนสวนสามญ (เปนบคคลธรรมดา)+ หางหนสวนสามญจดทะเบยน (เปนนตบคคล)

- หางหนสวนจากด (เปนนตบคคลมการจากดความรบผดชอบ)* มเงนทนและมคนชวยในการบรหารงานมากขน* เงนทนอาจยงไมมากเพยงพอ การตดสนใจทาไดชาลง ขยายธรกจ

ไดยาก เลกกจการไดงาย

ประเภทของธรกจ

แบงตามลกษณะการจดตง

Corporation - บรษทจากด คนตงแต 7 คนขนไป แบงทนเปนหนหนละเทาๆ กน จากดความรบผดชอบใน

หนสนของผถอหน มฐานะเปนนตบคคล - ขยายธรกจไดงาย จากดความรบผดชอบในหนสน มการ

แบงผลประโยชนทชดเจน โอนเปลยนความเปนเจาของไดงาย

- มขอบงคบและขอปฏบตทางกฎหมายมาก

UNDERSTANDING BUSINESS ORGANIZATIONS

• Business provide goods and services in order to earn profit.

• Business that provide goods are of three kinds:

Merchandising (Trading) Manufacturing Service

ประเภทของธรกจ

แบงตามลกษณะการดาเนนงาน

Service - กจการทใหบรการ จะนาเสนอสนคาทไมอาจจบตอง ได เชน ความบนเทง ความร การพกผอน สขภาพ เปนตน

Merchandising - กจการซอมาขายไป เปนผทซอสนคามา เพอขายตอใหกบลกคาซงอาจเปนผคาสงหรอผคาปลก

Manufacturing - กจการทผลตสนคา โดยจะซอวตถดบ จางแรงงานและจดหาอปกรณตางๆ และแปลงวตถดบนนๆ ใหเปน

สนคาเพอขายตอใหกบผคาสงหรอผคาปลกตอไป

Service Firm

Merchandising Firm

Manufacturing Firm

Investment by ownersInvestment by owners Loans from creditorsLoans from creditors

Monetary resources(Capital)

Monetary resources(Capital)

Continue business Activities

Continue business Activities

Pay Tax

Pay Tax

Pay Loan

Pay Loan

Pay return to owners

Pay return to owners

Monetary resources from sale of goods and services

Monetary resources from sale of goods and services

Produce good and service

Produce good and service

Buy land, buildings, and

equipment

Buy land, buildings, and

equipment

Pay other operating

exp.

Pay other operating

exp.

Pay employee Pay employee Purchase materials and

supplies

Purchase materials and

supplies

Business earningsBusiness earnings

วงจรธรกจ (Business Cycle)

What is Accounting?

What is Accounting?• Accounting is often called the language of

Business.• Accounting, as an information system, is the process

of identifying, measuring, and communicating the economic information

of an organization to its users

who need the information for decision making.

Definition of Accounting• The American Institute of Certified Public

Accountants (AICPA) defines accounting as “the art of recording, classifying and summarizing in a significant manner and in terms of money transactions and events which are, in part at least, of a financial character, and interpreting the results thereof”.

ความหมาย

“การบญช เปนระบบประมวลขอมลทางการเงน การจดบนทก รายการคาตาง ๆ ทเกยวกบการรบจายเงน สงของ และสทธทมมลคาเปน

เงนไวในสมดบญชอยางสมาเสมอ เปนระเบยบถกตองตามหลกการและ สามารถแสดงผลการดาเนนงานและฐานะการเงนของกจการในระยะเวลา หนงได"

17

Accounting is the information system that...Accounting is the information system that...

measures business activities,measures business activities,

processes data into reports, andprocesses data into reports, and

communicates results to decision makers.communicates results to decision makers.

Accounting – The Language of Business

OBJECTIVES OF ACCOUNTING

To maintain accounting records. เพอจดบนทกรายการตาง ๆ ทเกดขนเรยงตามลาดบกอนหลง และจาแนกประเภทของรายการคาไวอยางสมบรณ และถกตองตามหลกการบญชและตามกฎหมายวาดวยการบญช

To calculate the results of operation เพอประเมนผลการดาเนนงาน

To ascertain the financial position เพอทราบสถานะทางการเงนขององคกร

To communicate the information to the users เพอแจงขอมลขาวสารแกผเกยวของ

USERS OF ACCOUNTING INFORMATION

Internal Users:Management group:

Board of DirectorsPartnersManagersOfficers

External Users:Investors (present and potential)LendersSuppliersPublic Group:Govt and Regulatory AuthoritiesEmployees and Trade UnionsCustomersRating AgenciesOthers:

Security AnalystsAcademiciansResearchers

ประโยชนของการบญช

1. ชวยใหเจาของกจการสามารถควบคมงานอยางใกลชด2. ชวยใหทราบผลการดาเนนงานของกจการ ในระยะเวลา

ใดเวลาหนง

3. ชวยใหทราบฐานะการเงนของกจการ ในระยะเวลาใด

เวลาหนง

ประโยชนของการบญช

4. ชวยในการบรหารงาน และใหขอมลอนเปนประโยชน

ในการวางแผนการดาเนนงาน

5. ชวยในการตรวจสอบหาขอผดพลาด6. ชวยในการกาหนดนโยบายและการตดสนใจตางๆ ของ

ธรกจ

7. ผลงทนซอหนจะอาศยขอมลทางการบญชตดสนใจใน การลงทน

Post to the ledger

บญชแยกประเภท

Source documents

Record transactions

Prepare a trial balance

งบทดลอง

Prepare financial statements and report

งบการเงน (งบกาไรขาดทน /

งบดล ฯลฯ )

Transaction Analyze

Overview of the Accounting Process

External Transactions occur between the

organization and an outside party.

Internal Transactions occur within the

organization.

Transactions and Events

Exchanges of economic consideration between two parties.

Sales Invoices

Bank Statement

Purchase Orders

Checks

Source Documents

Branches /Classification of Accounting

Financial Accounting

CostAccounting

ManagementAccounting

HumanResource

A/cing

ResponsibilityA/cing

InflationA/cing

Other EmergingBranches

Accounting

INPUT PROCESS OUTPUT

•Recording•Classifying •Summarizing•Analyzing•Interpreting

Communicating information to users *P&L A/cงบกาไรขาดทน

*B/S Balance sheet งบดล*CFS Cash flow statementงบประแสเงนสด ,etc)

Economic events  measured in 

financial terms

The Accounting Information System

Financial Statements

Profit and Loss A/c งบกาไรขาดทนStatement of financial performance

Balance sheet งบดลStatement of financial position

Statement of cash flows งบกระแสเงนสดStatement of cash receipts and cash payments

28

The Financial StatementsThe financial statements are a picture

of the company in financial terms.

Each financial statement relates to a specificdate or covers a particular period.

29

The Accounting Equation

Assets are the economic resourcesof a business that are expected toproduce a benefit in the future.

Liabilities are “outsider claims,”or economic obligations

payable to outsiders.Owners’ equity represents the“insider claims” of a business.

Assets ทรพยสน

What a business “owns”Probable future economic benefitsExamples

CashInvestmentsBuildingsPlant and MachineryPatents and Copyrights

สนทรพย (Assets)Assets ทรพยสน ความหมาย

บญญตศพทโดยสมาคมบญชและผสอบบญชรบ

อนญาตแหงประเทศไทยไดใหความหมายสนทรพยวาหมายถง สงมตวตนหรอหรอไมมตวตนอนมมลคาซงบคคลหรอกจการ

เปนเจาของ หรอมสทธครอบครอง โดยถกตองตามกฎหมาย

ประเภทของสนทรพย (Assets)แบงออกเปน 3 ประเภท ไดแก

1.

สนทรพยหมนเวยน (Current Assets)

2. สนทรพยถาวร เชน ทดน อาคาร และ อปกรณ (FIX Asset eg.Property Plant and Equipment)

3. สนทรพยอน (Other Assets Sundry Assets )

LandLand

EquipmentEquipmentBuildingsBuildings

CashCash

Prepaid Expenses Prepaid

Expenses

Office Supplies Office

Supplies

Store Supplies Store

Supplies

Prepaid Insurance Prepaid

Insurance Notes Receivable

Notes Receivable

Accounts Receivable Accounts

Receivable

ASSETSASSETS

Asset Accounts

Liabilities

What a business “owes”Probable future sacrifices of economic benefits เปนการลงทนเพอผลประโยชนในภายหนาExamples

Loans payable หน ทงในระยะสนและระยะยาวWarranty obligations ภาระผกพนตางๆ เชน การคาประกน Pensions payable เงนบานาญ เงนสงเคราะหทจะตองจายIncome tax payable ภาษคางจาย

หนสน ((Liability)Liability)

ความหมาย

หมายถง จานวนเงนทกจการเปนหนบคคลอนหรอ พนธะอนเกดจากรายการคา การกยมหรอเกดจากการอน ซงจะตอง

ชาระคนในภายหนาดวยสนทรพย หรอบรการ

Accrued Liabilities Accrued

LiabilitiesUnearned Revenues Unearned Revenues

Notes Payable Notes

PayableAccounts Payable

Accounts Payable

LIABILITIESLIABILITIES

LiabilityAccounts

ประเภทของหนสน (Liability)

1. หนสนหมนเวยน (Current Liabilities)

2. หนสนระยะยาว หรอหนสนอนๆ

(Long term or other Liabilities)

แบงเปน 2 ประเภท ดงน

Owner’s Equity• It is what’s left of the assets after liabilities

have been deducted (Residual interest of owners)– the same as net assets– the owner’s claim on the entity’s

assetsExamples

Share capital Share premiumRevenuesRetained profit

สวนของเจาของ (Owner’s Equity )

ความหมาย

สวนของเจาของ(Owner’s Equity) ตามคา

นยาม หมายถง สวยไดเสยคงเหลอในสนทรพยของกจการ

หลงจากหกหนสนออกแลว เปนสนทรพยสทธ (Net Assets) ของกจการ

EquitiesEquities

RevenuesRevenues

Owners’ Capital

Owners’ Capital Owners’

Withdrawals Owners’

Withdrawals

ExpensesExpenses

Equity Accounts

LiabilitiesLiabilities EquityEquityAssetsAssets = +

Owner’s Capital

Owner’s Capital

Owner’s Withdrawals

Dividend

Owner’s Withdrawals

Dividend

RevenuesRevenues ExpensesExpenses

Accounting Equation

+ +– –

Exh.3.3

สมการบญช (Accounting Equation)

สนทรพย = หนสน + สวนของเจาของ

Assets = Liability + Owner’s Equity

A = L + OE

EconomicResources

Claims toEconomicResources

The Accounting Equation

Assets = Liabilities + Owner’s Equity

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Information Reported on the Financial Statements

1. How well did thecompany perform(or operate) duringthe period?

Revenues– Direct Expenses

Gross income (Gross loss)

TradingAccount

Question AnswerFinancialStatement

1. How well did thecompany perform(or operate) duringthe period?

Gross Profit– Indirect Expenses

Net income (Net loss)

Profit and Loss

Account

45

Information Reported on the Financial Statements

3. What is the company’sfinancial position at theend of the period?

Assets= Liabilities

+ Owners’ equity

Balancesheet

Question AnswerFinancialStatement

4. How much cash didthe company generateand spend duringthe period?

Operating cash flows±

Investing cash flows

±

Financing cash flows

Increase or decrease in cash

Statementof

cashflows

46

Income Statement งบกาไรขาดทน

The income statement, reports the company’s revenues,

expenses, and net incomeor net loss for the period.

47

Introduction to the Income Statement

The The income statementincome statement is a financialis a financialtool that provides information abouttool that provides information about

a companya company’’s past performances past performance..

48

The Income Statement

RevenuesRevenues

–ExpensesExpenses

= Net incomeNet income(or Net loss)(or Net loss)

49

Sales revenues– Cost of goods sold

Gross profit

Operatingincome

Selling andadministrative

expenses– =

Income Statement Format

Add: Other revenues and gainsLess: Other expenses and losses

Transactions that Affect Owner’s Equity

OWNER’S EQUITYINCREASES

OWNER’S EQUITYDECREASES

Owner Investmentsin the Business

Revenues Expenses

Owner Withdrawalsfrom the Business

Owner’s Equity

51

Income Statement

Revenue - the proceeds that come from sales to customers

Cost of Goods Sold - an expense that reflects the cost of the product or good that generates revenue. .

Gross Margin - also called gross profit, this is revenue minus

COGS

Operating Expenses - any expense that doesn't fit under COGS

such as administration and marketing expenses.

Net Income before Interest and Tax - net income before taking interest

and income tax expenses into account.

Interest Expense - the payments made on the company's outstanding debt.

Income Tax Expense - the amount payable to government.

Net Income - the final profit after deducting all expenses from revenue.

52

The Income Statement can be divided into:

• Trading Account

• Profit and Loss Account

53

The Accounting Terms

Revenues are inflows or otherRevenues are inflows or otherenhancements of assets to an entity.enhancements of assets to an entity.

They result from delivering orThey result from delivering orproducing goods, rendering services,producing goods, rendering services,or other activities that constitute theor other activities that constitute theentityentity’’s major or central operations.s major or central operations.

They are amounts received or to be received from customers for sales of products or services.

salesperformance of services

rentinterest

54

The Accounting Terms

Expenses are outflows orExpenses are outflows orother using up of assets.other using up of assets.

They result from delivering orThey result from delivering orproducing goods, rendering services,producing goods, rendering services,or other activities that constitute theor other activities that constitute theentityentity’’s major or central operations.s major or central operations.

They are amounts that have been paid or will be paid later for costs that have been incurred to earn revenue.

salaries and wagesutilities

supplies usedadvertising

55

The Accounting Terms

– Gross profit (gross margin) - excess of sales revenue over the cost of inventory that was sold

– Operating expenses - a group of recurring expenses that pertain to a firm’s routine operations

– Operating income (operating profit) - gross profit less all operating expenses

– Other revenues and expenses - items not directly related to the main operations of a firm

56

The Accounting Terms

• Net income - the remainder after all expenses (including income taxes) have been deducted from revenue– Often seen as the “bottom line”

• Net loss - the excess of expenses over revenues

Analyze the transaction and its source.Identify the impact of the transaction on account balances.

Also identify the financial statements that are impacted by the transaction.

Analyzing Transactions

Importance of managerial accounting information for decision making

Planning

Directing

Controlling

Improving

Decision making

Cost Concept

Cost : a payment of cash; or its equivalent; or the commitment to pay cash in the future for the purpose of generating revenues

Classification of costs

By behavior

By function

By period

Classification by behavior

1. Fixed costs

3. Semi variable costs

2. Variable costs

Does not change when the volume of activity changes.

Changes in proportion with the changes in the volume of activity.

A mixed of fixed and variable costs.

Relationship between fixed costs and activity

Costs

Activity (unit)

Total fixed cost

10 20 30

Relationship between variable costs and activity

Costs

Activity (unit)

Total variable cost

10 20 30

Relationship between mixed costs and activity

Cost

Activity (unit)

Total mixed costs

10 20 30

Classification by function

1. Manufacturing costs

2. Administration costs

3. Selling costs

Cost incurred in the process of transferring raw material to finished goods.

Cost incurred and related to administration activities.

Cost incurred and related to the selling and distributing activities.

Manufacturing Cost Concept

Manufacturing consists of activities and processes that convert raw materials into finished goods.

Manufacturing costs are usually classified as follows:

Direct materials

Direct labor

Manufacturing overhead

Manufacturing Cost : Direct Materials

Raw materials are the basic materials and parts that are to be used in the manufacturing process.

Raw materials that can be physically and directly associated with the finished product during the manufacturing process are called direct materials.

Manufacturing Cost : Indirect Materials

Some raw materials cannot be easily associated with the finished product. These are considered indirect materials.

Are accounted for as part of manufacturing overhead and :

1 do not physically become part of the finished product; or

2 cannot be traced because their physical association with the finished product is too small in terms of cost.

Manufacturing Cost : Direct Labor

Direct labor is the work of factory employees that can be physically and directly associated with converting raw materials into finished goods.

The wages of maintenance people, timekeepers, and supervisors are usually identified as indirect labor. Their efforts have no physical association with the finished product.

Like indirect materials, indirect labor is part of manufacturing overhead.

Manufacturing Cost : Overhead

Manufacturing overhead consists of costs that are indirectly associated with the manufacture of the finished product.

These costs may also be manufacturing costs that cannot be classified as direct materials or direct labor.

Manufacturing overhead includes1 indirect materials;2 indirect labor;3 depreciation on factory buildings and machines4 insurance, taxes, and maintenance on

factory facilities.

Product Cost vs. Period Cost

Product costs include each of the manufacturing cost elements (direct materials, direct labor, and manufacturing overhead); they are costs that are a necessary and integral part of producing the finished product.

These costs are not expensed to cost of goods sold under the matching principle until the finished goods inventory is sold.

Product Cost vs. Period Cost

Direct materials and direct labor are often referred to as prime costs due to their direct association with the manufacturing of the finished product.

Direct labor and manufacturing overhead are often referred to as conversion costs since they are incurred in converting raw materials into finished goods.

Product Cost vs. Period Cost

Period costs:

are identifiable with a specific time period,

relate to non-manufacturing non-inventoriable costs,

and

include selling and administrative expenses.

Product Cost vs. Period Cost

Direct Material

Direct Labor

Factory OH

Prime Cost

Conversion Cost

Selling Expenses

Admin Expenses

Product Cost

Period Cost

Manufacturing Costs

Non-manufacturing Costs

74

The Breakeven Point (BEP)

The level of activity, in units or dollars, at which

REVENUES = COSTS

75

Basic Assumption: Relevant Range

Company is operating within the relevantrange of activity specified in determining the revenue

and cost information used.

Total$

Activity Level

RelevantRange

76

Basic Assumption: Revenue

Total revenue fluctuates in direct proportion to level of activity or volume. On a per unit basis, the selling

price remains constant.

Total$

Activity Level

77

Basic Assumption: Variable Costs

Total variable costs fluctuate in direct proportion to level of activity or volume. On a per unit basis,

variable costs remain constant.

Total$

Activity Level

78

Basic Assumption: Fixed Costs

Total fixed costs remain constant relative to activity level changes. Per-unit fixed costs decrease as

volume increases and increase as volume decreases.

Total$

Activity Level

79

Basic Assumption: Mixed Costs

Mixed costs must be separated into variable and fixed elements.

Total$

Activity Level

80

Breakeven Point

Breakeven point is the point at which profits are zero because total revenues equal total costs, or

Total revenues = Total fixed costs + Total variable costs

TR=TFC+TVCPxQ=TFC+TVCPXQ=TFC+(QxVC)

81

Cost Behavior Example

Selling price per PIECE $40

Variable production cost PIECE $20Variable selling cost per PIECE 4Total variable cost per PIECE $24

Fixed production costs $100,000Fixed selling and administrative costs 20,000

82

Continuing . . . Breakeven Point

In units 40 X Q =120,000+(Q X 16)40Q =120,000+24Q40Q-24Q=120,00016Q =120,000Q =7,500 PIECE

In dollars 7,500 x 40 = 300,000 USD

TR=TFC+TVCPxQ=TFC+TVCPXQ=TFC+(QxVC)

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Break Even Analysis

Costs/Revenue

Output/Sales

Initially a firm will incur fixed costs, these do not depend on output or sales.

FC

As output is generated, the firm will incur variable costs – these vary directly with the amount produced.

VC The total costs therefore (assuming accurate forecasts!) is the sum of FC+VC

TC Total revenue is determined by the price charged and the quantity sold – again this will be determined by expected forecast sales initially.

TR The lower the price, the less steep the total revenue curve.

TR

Q1

The break even point occurs where total revenue equals total costs – the firm, in this example, would have to sell Q1 to generate sufficient revenue to cover its costs.

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Break Even AnalysisCosts/Revenue

Output/Sales

FC

VCTCTR (p = £2)

Q1

If the firm chose to set price higher than £2 (say £3) the TR curve would be steeper – they would not have to sell as many units to break even

TR (p = £3)

Q2

85

Break Even AnalysisCosts/Revenue

Output/Sales

FC

VCTC

TR (p = £2)

Q1

If the firm chose to set prices lower (say £1) it would need to sell more units before covering its costs.

TR (p = £1)

Q3

86

Break Even AnalysisCosts/Revenue

Output/Sales

FC

VC

TCTR (p = £2)

Q1

Loss

Profit

87

Break Even AnalysisCosts/Revenue

Output/Sales

FC

VC

TCTR (p = £2)

Q1 Q2

Assume current sales at Q2.

Margin of Safety

Margin of safety shows how far sales can fall before losses made. If Q1 = 1000 and Q2 = 1800, sales could fall by 800 units before a loss would be made.

TR (p = £3)

Q3

A higher price would lower the break even point and the margin of safety would widen.