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Paper BC 1.2: Financial Accounting
Marks: 100
Lectures: 52, Practical: 26
Theory: 70
Practical: 30
Internal Assessment -20
Term End Exam - 50
Marks: 100
Lectures: 52, Practical: 26

Objectives: The objective of this paper is to help students to acquire conceptual knowledge of the financial accounting and to impart skills for recording various kinds of business transactions.

Unit 1: (a) Theoretical Framework                           5 Lectures                           14
i. Accounting as an information system, the users of financial accounting information and their needs. Qualitative characteristics of accounting, information, Functions, advantage and limitations of accounting. Branches of accounting. Bases of accounting; cash basis and accrual basis.
ii. The nature of financial accounting principles – Basic concept and conventions: entity, money measurement, going concern, cost, realization, accruals, periodicity, consistency, prudence (conservatism), materiality and full disclosures.
iii. Financial accounting standards: Concept, benefits, procedure for issuing accounting standards in India.
Unit 2: (b) Computerized Accounting Systems 26                            14

Computerized Accounting Systems: Computerized Accounts by using any
popular accounting software: Creating a Company; Configure and Features
settings; Creating Accounting Ledgers and Groups; Creating Stock Items and
Groups; Voucher Entry; Generating Reports – Cash Book, Ledger Accounts,
Trial Balance, Profit and Loss Account, Balance Sheet, Funds Flow
Statement, Cash Flow Statement.
Selecting and shutting a Company: Backup and Restore data of a Company
Unit 3: (a) Business Income and Final Accounts    15 Lectures                14
i. Measurement of business income-Net income: the accounting period, the continuity doctrine and matching concept. Objectives of measurement.
ii. Revenue recognition: Recognition of expenses
iii. The nature of depreciation. The accounting concept of depreciation. Factors in the measurement of depreciation. Methods of computing depreciation: straight line method and diminishing balance method; Disposal of depreciable assets-change of methods.
iv. Capital and revenue expenditures and receipts: general introduction only.
Preparation of financial statements of non-corporate business entities
(sole-proprietorship and partnership).
Unit 4: Accounting for Hire-Purchase and Installment Systems           14
i. Accounting for Hire-Purchase Calculation of Interest, Journal entries and lodger accounts in the books of Hire Vendors and Hire Purchaser for large value items excluding Default and repossession.
ii. Installment of payment systems
Unit 5: Accounting for Inland Branches
16 Lectures                              14
Concept of dependent branches; accounting aspects; debtors system, stock and debtors system, branch final accounts system and whole sale basis system. Independent branches: Concept accounting treatment: important adjustment entries and preparation of consolidated profit and loss account and balance sheet.
Practical – 30
In practical assignment will be given from Unit – II

1. The relevant Indian Accounting Standards in line with the IFRS for all the above topics should be covered.
2. Any revision of relevant Indian Accounting Standard would become applicable immediately.
3. Examination Scheme for Computerized Accounts – Practical for 20 marks. The practical examination will be for 1 hour.
4. Theory Exam shall carry 80 marks.

Suggested Readings:
1. Robert N. Anthony, David Hawkins, Kenneth A. Merchant, Accounting: Tax and Cases.
McGraw Hill Education, 13th Ed. 2013
2. Charles, T. Horngren and Donna Philbrick, Introduction to Financial Accounting. Pearson Education.
3. J.R. Monga, Financial Accounting: Concepts and Applications. Mayur Paper Backs, New Delhi
4. M.C. Shukla, T.S. Grewal and S.C. Gupta. Advanced Accounts, Vol. I. S. Chand & Co., New Delhi
5. S.N. Maheshwari, and S.K. Maheshwari, Financial Accounting. Vikas Publishing House, New Delhi
6. Deepak Sehgal, Financial Accounting. Vikas Publishing House, New Delhi
7. Bhushan Kumar Goyal and HN Tiwari, Financial Accounting, International Book House
8. Goldwin, Alderman and Sanyal, Financial Accounting, Cengage Learning
9. Tulsian, P.C. Financial Accounting, Pearson Education
10. Compendium of Statement and Standards of AccountingThe Institute of Chartered Accountants of India, New Delhi.

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