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12B101 ACCOUNTING FOR MANAGERS
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Accounting - Definition
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Users of Accounting Information
External Users.
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ASSETS
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ASSETS continue
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ASSETS continue
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LIABILITIES
Long-term liabilities
Short-term liabilities
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LIABILITIES continue..
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LIABILITIES continue..
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CAPITAL
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REVENUES
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STOCK
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STOCK: continue
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STOCK continue
Accounting Conventions.
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ACCOUNTING PRINCIPLES
Accounting Concepts
Accounting Conventions
The term concept is used to connote
accounting postulates, that is necessary
assumptions and conditions upon which
accounting is based. The term convention
is used to signify customs and traditions as
a guide to the presentation of accounting
statements. 22
ACCOUNTING PRINCIPLES
Accounting Concepts
Business Entity Concept
Money Measurement Concept
Cost Concept
Going Concern Concept
Dual Aspect Concept
Realization Concept
Accounting Period Concept 23
ACCOUNTING PRINCIPLES
Accounting Conventions
Convention of Consistency
Convention of Disclosure
Convention of Conservation
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ACCOUNTING PRINCIPLES
Accounting Concepts
The term concept is used to connote
accounting postulates, that is necessary
assumptions and conditions upon which
accounting is based.
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Business Entity Concept
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Money Measurement Concept
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Cost Concept
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Dual Aspect Concept
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Dual Aspect Concept continue
Accounting Conventions
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Convention of Consistency
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Convention of Conservation
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THE ACCOUNTING CYCLE
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CLASSIFICATION OF ACCOUNTS
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CLASSIFICATION OF ACCOUNTS
ACCOUNTS
PERSONAL IMPERSONAL
ACCOUNTS ACCOUNTS
REAL NOMINAL
ACCOUNTS ACCOUNTS
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PERSONAL ACCOUNTS
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REAL ACCOUNTS
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DEBIT AND CREDIT
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RULES FOR DEBIT AND CREDIT
Development
AS 9. Revenue Recognition
AS 10. Accounting for Fixed Assets
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ACCOUNTING STANDARDS
Contd
AS 11. Accounting for the Effects of
Changes in Foreign Exchange Rates
AS 12. Accounting for Government
Grants
AS 13. Accounting for Investments
AS 14. Accounting for Amalgamation
AS 15. Accounting for Retirement
Benefits in the financial Statements of
Employers
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ACCOUNTING STANDARDS
Contd
AS 16. Borrowing Costs
AS 17. Segment Reporting
AS 18. Related Party Disclosure
AS 19. Leases
AS 20. Earning Per Share
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THE FINAL ACCOUNTS TRADING ACCOUNT
A TRADER
TRADING ACCOUNT FOR YEAR ENDED 31 DECEMBER
Sales 5,400
Less Sales Returns 120
5,280
Less Cost of Goods Sold:
Purchases 2,800
Less Purchases Returns 50
Cost of Goods Sold 2,750
GROSS PROFIT 2,530
A TRADER
TRADING ACCOUNT FOR YEAR ENDED 31 DECEMBER
Sales 5,400
Less Sales Returns 120
5,280
Less Cost of Goods Sold:
Opening Stock 500
Add Purchases 2,800
Less Purchases Returns 50 2,750
3,250
Less Closing Stock 250
Cost of Goods Sold 3,000
GROSS PROFIT 2,28054
2C THE FINAL ACCOUNTS PROFIT AND LOSS ACCOUNT
The sole trader must pay all expenses out of Gross Profit
Gross Profit less Expenses = Net Profit
This is done by listing the expense account balances from the
Trial Balance in the Profit and Loss Account which is tacked
on to the end of the Trading Account after Gross Profit
GROSS PROFIT 2,280
Less Expenses:
Rent 200
Wages 800
Insurance 80
Heating and Lighting 250 1,330
NET PROFIT 950 55
THE FINAL ACCOUNTS BALANCE SHEET
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THE FINAL ACCOUNTS