Financial Accounting 1 notes – University notes

Financial Accounting 1

This unit is also referred to as Fundamentals of Accounting 1, foundations of accounting or introduction to Financial Accounting .The objectives of this course is:

  • To equip a student with the principles and concepts of preparing and keeping financial records.
  • To equip students with techniques to enable them prepare and interpret financial information.
  • The course seeks to build a solid foundation upon which student can rely upon as a building block for further advanced courses in Accounting and Finance.

SUBJECT CONTENT

INTRODUCTION TO ACCOUNTING

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  • Nature and scope of Accounting
  • Users of accounting information
  • The fundamental accounting principles, conventions and concepts
  • The work of accountant
  • The accounting equation and statement
  • Questions, Problems and Exercises

THE ACCOUNTING CYCLE

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  • Steps in accounting cycle
  • Recording changes in the financial position
  • The trial balance
  • Suspense account
  • Preparation of financial statements
  • Worksheet

ACCOUNTING FOR CASH

  • Cash control
  • Petty cash system
  • Cash book
  • Bank reconciliation statement

SPECIAL JOURNALS AND CONTROL ACCOUNTS

  • Sales Journal and ledger
  • Purchases Journal and ledger
  • Return inward journal
  • Return outward journal
  • Control accounts

FINAL ACCOUNTS

  • Trading, profits and loss account
  • Balance sheet
  • Manufacturing accounts

ACCOUNTING FOR INCOMPLETE RECORDS

  • Background of incomplete records
  • Reconstructing accounts
  • Trading, profits and loss account
  • Balance sheet

PARTNERSHIP ACCOUNTS

  • Features of partnership
  • Accounts and Division of profit

 

RECOMMENDED TEXTS

  1. Frankwood “ Business Accounting 1”
  2. Basis for Business Decisions; 10th Edition, Meigs & Meigs
  3. N.D. Nzomo. Basic Accounting, concepts, principle and procedures incorporating Kenya, laws &
  4. Standards, Nairobi University Press
  5. Saleemi N.A “ Financial Accounting 1”
  6. Hermanson, Edwards and Maher “ Accounting Principles, 5th Edition, Vin Hoffman Press, U.S.A
  7. Relevant International Accounting Standards