Accounting for income, expense and determining profit or loss at Hanoi Delicacy hotel & tourism company limited

BANKING ACADEMY OF VIETNAM

ADVANCED PROGRAM



GRADUATION THESIS

Major: Accounting

TOPIC: ACCOUNTING FOR INCOME, EXPENSE AND

DETERMINING PROFIT OR LOSS

At Hanoi Delicacy Hotel & Tourism Company Limited

Student name: Phan Thuy Dung

Class: K20CLCI

Course: 2017 – 2021

Student’s ID: 20A4020128

Instructor: MintA. Nguyen Thi Thanh Mai

HANOI – 2021

i

ACKNOWLEDGEMENTS

First and foremost, I would like to express my sincere thanks to all teachers in

Banking Academy, especially the faculty of Accounting and Auditing and Advanced

Program for their passion for conveying knowledge to students. Valuable knowledge

that I have learned in nearly 4 years not only helps me to achieve good results in my

internship period but also helps me get more confident on the way to become an

accountant.

Especially, I would like to express my endless thanks and gratefulness to my

instructor – MintA. Nguyen Thi Thanh Mai for guiding and supporting me to

complete my Graduation Thesis. Her constructive comments and encouragement

have significantly improved my work.

Also, I would like to express my sincere gratitude to Hanoi Delicacy Hotel &

Tourism Company Limited for supporting me a lot when I am in the internship period.

Besides, I would like to give special thanks to Mrs. Tran Thi Tan – chief accountant

of the company who was willing to answer all questions about my thesis and provided

me a lot of information about the company.

Last but not least, I would like to express my deepest gratitude to my family

and friends have always been a tremendous source of support and inspiration for me

during this course.

Thanks and best regards,

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COMMITMENT

I am Phan Thuy Dung, a student of K20CLCI, I hereby declare that my

Graduation Thesis is my own research and that has not been submitted anywhere for

any award. The data and results in the thesis are completely honest. If there exist any

frauds, I am totally responsible to Banking Academy.

Hanoi, 18th May 2021

The author

Phan Thuy Dung

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TABLE OF CONTENTS

ACKNOWLEDGEMENTS............................................................................. i

COMMITMENT............................................................................................. ii

TABLE OF CONTENTS............................................................................... iii

LISTS OF ACRONYMS ............................................................................... vi

LIST OF TABLE AND ILLUSTRATION................................................... vii

INTRODUCTION ...........................................................................................1

CHAPTER 1: THEORETICAL BASIS FOR ACCOUNTING FOR

INCOME, EXPENSE AND DETERMINING PROFIT OR LOSS.....................5

1.1. Overview for income, expense and determining profit or loss.............5

1.1.1. Overview for income ......................................................................5

1.1.2. Overview for expense .....................................................................7

1.1.3. Overview for determining profit or loss.........................................9

1.2. Roles and duties of accounting for income, expense and determining

profit or loss ..........................................................................................................10

1.2.1. The role of accounting for income, expense and determining profit

or loss................................................................................................................10

1.2.2. The duty of accounting for income, expense and determining profit

or loss................................................................................................................10

1.3. Accounting for income, expense and determining profit or loss........11

1.3.1. Accounting for income .................................................................11

1.3.2. Accounting for expense ................................................................19

1.3.3. Accounting for determining profit or loss....................................33

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CHAPTER 2: CURRENT ISSUES OF ACCOUNTING FOR INCOME,

EXPENSE AND DETERMINING PROFIT OR LOSS AT HANOI DELICACY

HOTEL & TOURISM COMPANY LIMITED ...................................................35

2.1. Overview of Hanoi Delicacy Hotel & Tourism Co ............................35

2.1.1. The process of formation and development .................................35

2.1.2. Duties and functions of the company ...........................................37

2.1.3. Ordinary activities .......................................................................37

2.1.4. Organizational structure..............................................................38

2.2. The financial situation and business results of the Company.............39

2.3. Organizing accounting work at Hanoi Delicacy Central Hotel & Spa

...............................................................................................................................43

2.3.1. Organization structure of accounting department at Hanoi

Delicacy Hotel & Tourism Co., Ltd ..................................................................43

2.3.2. Duties and functions of accounting department ..........................43

2.3.3. Accounting standards...................................................................44

2.4. Current issues of accounting for income, expense and determining

profit or loss at Hanoi Delicacy Hotel & Tourism Co ..........................................46

2.4.1. Current issues of accounting for income at the company............46

2.4.2. Current issues of accounting for expense at the company...........59

2.4.3 Current issues of accounting for determining profit or loss.........70

2.5. Evaluation on accounting for income, expense and determining profit

or loss at Hanoi Delicacy Hotel & Tourism Co ....................................................71

2.5.1. Advantages...................................................................................72

2.5.2. Limitations and reason ................................................................74

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CHAPTER 3: SOLUTIONS FOR COMPLETION OF ACCOUNTING

FOR INCOME, EXPENSE AND DETERMINING PROFIT OR LOSS AT

HANOI DELICACY HOTEL & TOURISM CO., LTD.....................................77

3.1. Solutions to complete accounting for income, expense and determining

profit or loss at Hanoi Delicacy Hotel & Tourism Co ..........................................77

3.1.1. Development orientation of the company until 2025...................77

3.1.2. The need for completion of accounting for income, expense and

determining profit or loss..................................................................................77

3.1.3. Orientation to complete accounting for income, expense and

determining profit or loss..................................................................................78

3.2. Conditions for implementing solutions and recommendations ..........82

3.2.1. From Hanoi Delicacy Hotel & Tourism Co ................................82

3.2.2. From the authorities.....................................................................83

CONCLUSION..............................................................................................86

REFERENCES...............................................................................................87

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LISTS OF ACRONYMS

COGS Cost of goods sold

G&A General and Administrative

SCT Special consumption tax

VAS Vietnam Accounting Standards

VAT Value added tax

CO., LTD Company Limited

WAC Weighted Average Cost

FIFO First in, first out

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LIST OF TABLE AND ILLUSTRATION

Figure 1. 1: Accounting entry for revenue from goods sale and provision of

services applying deductible VAT method...............................................................13

Figure 1. 2: Accounting entry for revenue from goods sale and provision of

services applying export tax, excise tax and environment tax..................................13

Figure 1. 3: Accounting entry for revenue deduction ....................................16

Figure 1. 4: Accounting entry for financial incomes.....................................17

Figure 1. 5: Accounting entry for other income ............................................19

Figure 1. 6: Accounting entry for COGS applying perpetual inventory

method.......................................................................................................................22

Figure 1. 7: Accounting entry for COGS applying periodical inventory

method.......................................................................................................................23

Figure 1. 8: Accounting entry for selling expenses .......................................25

Figure 1. 9: Accounting entry for general & administrative expenses..........27

Figure 1. 10: Accounting entry for financial expenses..................................29

Figure 1. 11: Accounting entry for CIT expense ...........................................31

Figure 1. 12: Accounting entry for other expenses........................................32

Figure 1. 13: Accounting entry for determine business performance............33

Figure 2. 1: Organization chart of the Company ...........................................38

Figure 2. 2: Organization structure of accounting department ......................43

Figure 2. 3: Procedures for recording accounting books in the .....................45

viii

Table 2. 1: Balance sheet (2019-2020) ..........................................................40

Table 2. 2: Income statement (2019-2020)....................................................42

Form 2. 1: Receipt..........................................................................................53

Form 2. 2: VAT Invoice (1)...........................................................................54

Form 2. 3: General Ledger of Account 511...................................................55

Form 2. 4: VAT Invoice (2)...........................................................................56

Form 2. 5: General Ledger of Account 515...................................................57

Form 2. 6: General Ledger of Account 711...................................................58

Form 2. 7: Accounting voucher .....................................................................61

Form 2. 8: General Ledger of Account 627...................................................62

Form 2. 9: General Ledger of Account 632...................................................65

Form 2. 10: General Ledger of Account 642.................................................68

Form 2. 11: General Ledger of Account 635.................................................69

Form 2. 12: General Ledger of Account 911.................................................71