Accounting is the language of business. It is the system of recording, summarizing, and analyzing an economic entity’s financial transactions. Effectively communicating this information is key to the success of every business. Learn about debits and credits, financial statements, and the reason why accounting is useful.
Financial accounting is a specialized branch of accounting that keeps track of a company’s financial transactions. Using standardized guidelines, the transactions are recorded, summarized, and presented in a financial report or financial statement such as an income statement or a balance sheet.
Companies issue financial statements on a routine schedule. The statements are considered external because they are given to people outside of the company, with the primary recipients being owners/stockholders, as well as certain lenders. If a corporation’s stock is publicly traded, however, its financial statements (and other financial reporting’s) tend to be widely circulated, and information will likely reach secondary recipients such as competitors, customers, employees, labor organizations, and investment analysts.
It’s important to point out that the purpose of financial accounting is not to report the value of a company. Rather, its purpose is to provide enough information for others to assess the value of a company for themselves.
To equip the students with the skill of preparing accounts & financial statements of various types of business units other than corporate undertakings.
Module – I
Preparation of Financial Statements –Conceptual framework- Accounting Principles – Accounting Concepts – Accounting Conventions- – Capital and Revenue Expenditure – Capital and Revenue Receipts – Capital and Revenue Losses – Deferred Revenue Expenditure–Accounting Standards- Objectives -Final Accounts of Sole Trader – Trading Account – Manufacturing Account – Profit and Loss Account – Balance Sheet – Adjusting entries – Closing Entries- Practical Problems with all Adjustments.
Accounting of Incomplete Records – Single Entry System – Features – Advantages – Disadvantages -Distinction between Single Entry and Double Entry System- Ascertainment of Profit/loss – Statement of Affairs Method – Conversion Method – Steps for Conversion of Single Entry into Double Entry -Preparation of Trading and Profit and Loss Account and Balance Sheet.
Module – III
Royalty Accounts – Meaning – Minimum Rent – Short Working – Recovery– Journal Entries in the books of Lessor and Lessee – Preparation of Minimum Rent Account – Short Working Account – Royalty Account (Excluding Sublease)– Special Circumstances :Adjustment of Minimum Rent in the event of Strike and Lock – outs – Govt. Subsidy in case of Strikes/Lockouts.
Module – IV
Accounting for Consignment – Meaning – Important Terms – Journal Entries in the books of Consignor and Consignee – Preparation of Consignment Account – Consignee’s Account – Goods Sent at Cost or Invoice Price. Delcredre commission- Valuation of Stock – Normal and Abnormal Loss.
Module – V
Farm Accounts- Meaning- Characteristics- Objectives and advantages- Recording of farm transactions-Preparation of farm account, crop account, dairy account, livestock account etc- Preparation of final accounts of farming activities-.