Bookkeeping II BBS203

COURSE STRUCTURE

There are 12 lessons as follows:

1. Trading firms and accounting rules

2. Physical Inventory System

3. Perpetual Inventory System

4. Inventory Valuation

5. Accounting for bad and doubtful debts

6. Classified Profit and Loss Statements for trading firms

7. Control Accounts

8. Budgeting for Trading Firms

9. Statement of Cash Flows

10. Alternatives in Accounting

11. Analysis and Interpretation of Accounting Reports

12. Business Expansions and Sources of Finance

Each lesson culminates in an assignment which is submitted to the school, marked by the school's tutors and returned to you with any relevant suggestions, comments, and if necessary, extra reading.

COURSE AIMS

On successful completion of the course you should be able to do the following:

• Describe the nature of trading businesses, and the differences between recording and reporting for trading businesses and service businesses.
• Describe the nature of stock and the physical system of recording inventory.
• Explain the perpetual or continuous system of recording for inventory, the use of stock cards and methods of stock valuation.
• Distinguish between the main methods for valuing merchandise on hand and the procedures that need to be set up in order to maintain the different systems.
• Distinguish between bad debts and doubtful debts
• Explain how to prepare the journal entries and understand the effect of bad debts on final accounting reports.
• Extend your knowledge of the classification in accounting reports and how it is applied to trading firms.
• Acquire an understanding of control accounts and their uses.
• Explain of the use of budgets and to apply the skills learned.
• Explain the use and role played by statements of cash flows.
• Explain the different accounting alternatives available to business and the advantages and disadvantages of the various alternatives.
• Describe the tools used to measure the key areas of performance and financial position of a business and how they can aid in decision making.
• Describe the different sources of finance available to businesses, other methods of expanding a business and the impact of different equity structures on the accounting and decision making processes.
  
  
  

WHAT YOU WILL DO IN THIS COURSE

Here are just some of the things you will be doing:

• Describe the flow of financial information through a trading firm by preparing a flow chart.
• What are the four general objectives of accounting?
• Explain how a physical item may be classified as inventory for one business but as a non-current asset for another.
• Outline the two ways the value determined by a physical stocktake affects the final accounting report.
• What are the two processes involved in completing a physical stocktake?
• Write a brief description of what is involved in the perpetual inventory system.
• State and describe four advantages and four disadvantages of the perpetual inventory system.
• List the three special journals which need to be modified if a business changes from the physical method to the perpetual method or recording inventory.
• Explain the role of barcodes in recording inventory transactions.
• List four items of financial information that can be generated on a daily basis if a computerised barcoding system is used.
• Explain the relationship between the doctrine of conservatism and the lower of cost and NRV rule
• Distinguish between the terms doubtful debts and bad debts.
• Explain how the allowance for doubtful debts can incorporate both bad and doubtful debts for a period.
• Describe two different ways of estimating the value of an allowance for doubtful debts.
• List the benefits of classification to management.
• Describe the benefits of departmental reporting.
• State and describe the advantages and disadvantages of control accounts.
• Explain the importance of cash budgeting when accounting for a trading firm.
• Explain the purpose of a budget performance report.
• Prepare estimates of the future cash inflows for a business
• Prepare a table showing the breakdown between credit and cash sales for the six months July-Dec.
• Explain the role of the doctrine of disclosure when management decides to change depreciation methods.
• Explain why some accountants criticise the historical cost accounting system
• Distinguish between analysis and interpretation
• How is it possible for a business to show an increase in their gross profit ratio but a decrease in their net profit ratio
• What does an asset turnover ratio tell a business owner?
• List five aspects of the profit report which are likely to be considered by the lender.
• What are the benefits of preparing a well researched finance application?
  
  TAKE YOUR ACCOUNTING SKILLS TO THE NEXT LEVEL WITH THIS ADVANCED COURSE!

Online Study Course - Enroll in this qualification today, for home study by e-learning