Section A: Fundamentals of accounting (60 Marks)
Objective: To develop conceptual understanding of the fundamentals of financial accounting system.
- Theoretical Framework:- Meaning and scope of accounting, Accounting Concepts, Principles and Conventions, Accounting Policies, Accounting as a measurement discipline- valuation principles, accounting estimates.
- Accounting Process: – Books of account leading to the preparation of trial balance, capital and revenue expenditures, capital and revenue receipts, contingent assets and contingent liabilities, fundamental errors including rectifications thereof.
- Bank Reconciliation Statement.
- Inventories: – Basis of inventory valuation and record keeping.
- Depreciation Accounting: – Methods, computation and accounting treatment of depreciation, change in depreciation methods.
- Preparation of Final Accounts for Sole Proprietors.
- Accounting for special transactions: – Consignments, Joint ventures, Bills of exchange and promissory notes, Sale of goods on approval or return basis.
- Partnership Accounts: – Final accounts of partnership firms- Basic concepts of admission, retirement and death of a partner include treatment of goodwill.
- Introduction of Company Accounts: – Issue of shares and debentures, forfeiture of shares, re-issue of forfeited shares, redemption of preference shares.