Book description
Texts on Financial Accounting have much in common; but differences run deep. The present text has been class-tested for more than twenty years. Rich in pedagogy and written in an easy-to-understand manner, this book adopts a fresh and novel approach to the study of accounting keeping in view the specific requirements of the students appearing in the B.Com. examination of the Indian universities and other professional examinations.Table of contents
- Cover
- FINANCIAL ACCOUNTING
- Preface
- CONTENTS
-
1. INTRODUCTION TO ACCOUNTING
- Introduction
- Meaning of Accounting
- Accountancy, Accounting and Book-keeping
- Relationship Between Accountancy, Accounting and Book-keeping
- Distinction Between Book-keeping and Accounting
- Meaning of an Accounting Cycle
- Users of Accounting Information and Their Needs
- Primary Objectives of Accounting
- Types of Accounting Information
- Advantages of Accounting
- Limitations of Accounting
- Qualitative Characteristics of Financial Statements
- Branches of Accounting
- Basic Accounting Terminology
- Double Entry System of Book-keeping
- Relationship of Accounting with Other Discipline
- Role of an Accountant in the Society
- Accrual Basis of Accounting and Cash Basis of Accounting
- Distinction Between Accrual Basis of Accounting and Cash Basis of Accounting
- Concept of Income
- Accounting Concept of Income
- How to Compute Accounting Income
- Economic Concept of Income
- How to Compute Economic income
- Theoretical Questions
- 2. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
- 3. ACCOUNTING STANDARDS
- 4. ACCOUNTING POLICIES
- 5. ACCOUNTING EQUATION
-
6. JOURNALIZING, POSTING AND BALANCING
- Meaning of an Account
- Traditional Classification of Accounts
- Accounting Equation Based Classification of Accounts
- Comparison of Traditional Classification and Accounting Equation Based Classification of Accounts
- Meaning and Rules of Debit and Credit
- Meaning and Format of Journal
- Meaning of Journalizing
- Distinction Between Journal and Ledger
- Invoice
- Trade Discount
- Cash Discount
- Distinction Between Trade Discount and Cash Discount
- Ledger
- Compound Entry
- Meaning, Recording and Posting of Opening Entry
- Balancing
- Comprehensive Problems
- Theoretical Questions
- Practical Questions
-
7. SUBSIDIARY BOOKS I-CASH BOOK
- Need for Sub-division of the Journal
- Meaning of Special Journals (or Subsidiary Books)
- Advantages of Special Journals (or Subsidiary Books)
- Distinction Between Books of Original Entry and Ledger
- Meaning and Types of Cash Books'
- Single Column Cash Book
- Trade Discount
- Cash Discount
- Distinction Between Trade Discount and Cash Discount
- Distinction Between Commission and Discount
- Cash Book with Discount Column
- Three Column Cash Book
- Petty Cash Book
- Theoretical Questions
- Practical Questions
- 8. SUBSIDIARY BOOKS II-OTHER BOOKS
-
9. FINANCIAL STATEMENTS
- Meaning of Financial Statements
- Usefulness of Financial Statements
- Elements of Financial Statements
- Recognition of Assets, Liabilities, Income and Expenses
- Measurement of the Elements of Financial Statements
- Trading Account
- Manufacturing Account
- Distinction Between Manufacturing Account and Trading Account
- Profit and Loss Account
- Balance Sheet [or Position Statement]
- Distinction Between Tangible Assets and Intangible Assets
- Distinction Between Fixed Assets and Current Assets
- Grouping and Marshalling of Assets and Liabilities
- Distinction Between Trading and Profit and Loss Account and Balance Sheet
- Distinction Between a Trial Balance and a Balance Sheet
- Methods of Presenting the Final Accounts
- Treatment of Some Items which may be Direct Items/indirect Items/Incomes/Expenses
- Classification of Capital and Revenue
- Rationale of Making Adjustments at the Time of Preparing the Final Accounts
- Distinction Between Outstanding Expense and Prepaid Expense
- Distinction Between Deferred Revenue Expenses and Prepaid Expenses
- Distinction Between Accrued Income and Unaccrued Income
- Treatment of Items of Adjustment Appearing Outside the Trial Balance
- Treatment of Items of Adjustments Appearing in the Trial Balance
- Solved Problems
- Solved Problems (Advanced)
- Professional Examination Problems
- Theoretical Questions
- Practical Questions
-
10. FINANCIAL STATEMENTS OF NOT -FOR-PROFIT ORGANISATIONS
- Meaning of Not-for-Profit Organisations
- Distinction Between a Profit Seeking Organisation and a Not-for-Profit Organisation
- Fund Based Accounting
- Accounting for Not-for-Profit Organisations
- Receipts and Payments Account
- Income and Expenditure Account
- Meaning and Accounting Treatment of some Peculiar Items
- Distinction Between Receipts and Payments Account and Income and Expenditure Account
- Distinction Between Income and Expenditure Account and Profit and Loss Account
- Preparation of an Income and Expenditure Account from a Receipts and Payments Account
- Preparation of a Receipts and Payments Account from an Income and Expenditure Account
- Preparation of Balance Sheet of a Not-for-Profit Organisation
- Accounts of a Professional Firm
- Solved Problems
- Solved Problems (Advanced)
- B. Com. Examination Problems
- Professional Examination Problems
- Theoretical Questions
-
11. DEPRECIATION, PROVISIONS AND RESERVES
- Meaning of Depreciation
- Meaning of Depreciation Accounting
- Causes of Depreciation
- Need for Charging Depreciation
- Factors Affecting the Amount of Depreciation
- Depreciation on Additions to Fixed Assets
- Methods of Recording Depreciation
- Recording of Depreciation by Charging to Asset Account Method
- Methods of Allocating Depreciation
- 'Straight Line Method' of Depreciation (SLM)
- 'Written Down Value Method' of Depreciation (WDV)
- Distinction Between Straight Line Method and Written Down Value Method
- Recording of Depreciation by Creating Provision for Depreciation Account
- Change in the Method of Depreciation
- Sinking Fund Method or Depreciation Fund Method
- Meaning and Objectives of Provision
- Meaning, Objectives and Types of Reserves
- Distinction Between Revenue Reserve and Capital Reserve
- Distinction Between 'Provision' and 'Reserve'
- Specific Requirements of AS-6 Issued by ICAI
- Solved Problems
- B.Com. Examination Problems
- Professional Examination Problems
- Theoretical Questions
- Practical Questions
-
12. VALUATION OF INVENTORY
- Meaning of Inventories
- Meaning of Cost for Inventory Valuation
- Exclusions from the Cost of Inventories
- Inventory Systems
- Distinction Between Periodic Inventory System and Perpetual Inventory System
- Methods of Valuation of Inventories
- Requirements of Accounting Standard 2 as to Method
- First in First Out (FIFO) Method
- Last in First Out (LIFO) Method
- Distinction Between FIFO and LIFO Method of Valuation of Inventory
- Weighted Average Price Method
- Adjusted Selling Price [or Retail Inventory Method]
- Base Stock Method
- Specific Identification Method
- Standard Cost Method
- Valuation of Inventory as on Balance Sheet Date
- Stock as per Books and Stock as per Physical Verification
- Lower of Cost or Net Realisable Value Rule
- Methods of Comparison of Cost or Net Realisable Value
- Disclosure Requirements
- Specific Requirements of AS-2 Issued by ICAI
- Solved Problems
- B. Com. Examination Problems
- Professional Examination Problems
- Theoretical Questions
- Practical Questions
-
13. ACCOUNTING FOR PARTNERSHIP-DISSOLUTION OF A FIRM
- Dissolution of Partnership vs Dissolution of a Firm
- Distinction Between Dissolution of Partnership and Dissolution of Firm
- Settlement of Accounts [Section 48]
- Treatment of Firm's Debts and Private Debts [Section 49]
- Distinction Between Firm's Debts and Private Debts
- Realisation Account
- Accounting Entries
- Treatment of Goodwill
- Preparation of Balance Sheet as on Date of Dissolution
- Preparation of Balance Sheet as on the Date of Dissolution of Firm
- Calculation of Remuneration Payable to Incharge of Realisation
- Taking Over the Business of a Dissolved Firm by Some of its Partners to Continue the Same Business
- Return of Premium (Goodwill) in Case of Dissolution of Firm Before the Expiry of a Fixed Term [Section 51]
- Professional Examination Problems
- Theoretical Questions
- Practical Questions
-
14. PARTNERSHIP-INSOLVENCY, PIECEMEAL DISTRIBUTION, SALE OF A FIRM AND AMALGAMATION OF FIRMS
- Introduction
- Decision in Gamer vs Murray
- Applicability of the Decision in Gamer vs Murray in India
- Insolvency of a Firm
- Piecemeal Distribution
- Basis of Distribution of Cash Among Partners Towards their Capitals
- Maximum Loss Method
- Proportionate Capital Method
- Sale of a Firm to a Company
- Amalgamation of Firms
- B. Com. Examination Problems
- Professional Examination Problems
- Theoretical Questions
- Practical Questions
-
15. ACCOUNTS FROM INCOMPLETE RECORDS [OR SINGLE ENTRY SYSTEM]
- Meaning of Incomplete Records
- Reasons of Incomplete Records
- Limitations of Incomplete Records
- Distinction Between Double Entry System and Incomplete Records (Popularly known as Single Entry System]
- Preparation of Accounts from Incomplete Records
- Statement of Affairs Method
- Distinction Between Statement of Affairs and Balance Sheet
- Final Accounts Method
- Hints for Tracing Missing Information
- Solved Problems
- B. Com. Examination Problems
- Theoretical Questions
- Practical Questions
-
16. ACCOUNTING FOR HIRE PURCHASE
- Meaning of Hire Purchase Agreement
- Contents of Hire Purchase Agreement
- Meaning of Instalment Purchase Agreement
- Distinction Between Hire Purchase Agreement and Instalment Purchase Agreement
- Calculation of Interest When Both the Cash Price and the Rate of Interest are Given
- Calculation of Interest When Cash Price is Given but Rate of Interest is Not Given
- Calculation of Interest When Both the Cash Price and the Rate of Interest are Not Given
- Calculation of Cash Price
- Calculation of Cash Price in Case of Equal Annual Instalments with the Help of Annuity Formula
- Accounting for Hire Purchase Transactions
- Full Cash Price Method
- Journal Entries Under Full Cash Price Method
- Disclosure in Balance Sheet Under Full Cash Price Method
- Actual Cash Price Paid Method
- Journal Entries Under Actual Cash Price Paid Method
- Disclosure in Balance Sheet Under Actual Cash Price Paid Method
- Default and Repossession
- Complete Repossession
- Partial Repossession
- Accounting for Goods of Small Sales Values
- Methods of Ascertaining Profit
- Debtors Method
- Stock and Debtors Method
- Accounting for Instalment Purchase
- Journal Entries Under Interest Suspense Method
- Disclosure in Balance Sheet Under Interest Suspense Method
- Accounting for Guaranteed Service
- B. Com. Examination Problems
- Professional Examination Problems
- Theoretical Questions
- Practical Exercises
-
17. ACCOUNTING FOR BRANCHES
- Meaning of a Branch
- Classification of Branches
- Accounting for Dependent Branches
- Debtors Method
- Accounting Treatment of Goods Returned and Cash Remitted by Branch Customers Directly to Head Office
- Accounting Treatment of Goods Sent to Another Branch and Goods Received from Another Branch
- Accounting Treatment of Normal Loss, Abnormal Loss, Insurance Claim and Agreed Allowance/Trade Discount
- Accounting Treatment of Branch Manager's Commission
- When Goods are Sent to Branch at Cost plus Profit
- Stock and Debtors Method
- Final Accounts Method
- Whole Sale Branch Method
- Accounting for Independent Branches
- Incorporation of Branch Results in the Books of Head Office
- B. Com. Examination Problems
- Theoretical Questions
- Practical Questions
- 18. USE OF COMPUTERS IN ACCOUNTING
- Appendlx-I
- Appendix-II
- Appendix-III
- Appendlx-IV
- Appendlx-V
- Copyright
Product information
- Title: Financial Accounting
- Author(s):
- Release date: November 2002
- Publisher(s): Pearson Education India
- ISBN: 9789352861149
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