TOPIC 13: GOVERNMENT BUDGETING PROCEDURE | B/KEEPING FORM 3 Meaning of a Budget Define a budget : A budget is a set of interlinked plans that quantitatively describe an entity’s projected future operations. A budget is used as a yardstick against which to measure actual operating results, for the allocation of funding, and as a … Read more
TOPIC 12: ACCOUNTS OF NON-PROFIT MAKING ORGANIZATIONS | B/KEEPING FORM 3 Accounting of Non-Profit Making Organizations Preparation of Statement of Affairs Prepare statements of affairs Certainly, proper accounting is essential for non-trading institutions. These concerns maintain, generally, a cash book and later they prepare a summary of cash transactions appearing in the cash book. This … Read more
TOPIC 11: INCOMPLETE RECORDS | B/KEEPING FORM 3 Statements Showing Profit or Loss From Incomplete Records Draw up statements to show profit or loss from incomplete records Some times, businesses, especially small businesses do not maintain a full set of double entry records. Consequently, no trial balance will be produced and a complete set of … Read more
TOPIC 9: MANUFACTURING ACCOUNT | B/KEEPING FORM 3 Manufacturing Account Difference in Accounting for Stocks between Manufacturing Companies and Merchandising Companies Explain the difference in accounting for stocks between manufacturing companies and merchandising companies The businesses which produce and sell the items prepare the following accounts at the end of its accounting year:- The Manufacturing … Read more
TOPIC 8: BALANCE SHEET (CLASSIFIED) | B/KEEPING FORM 3 Meaning of Each Asset and Liability Classification Appearing on a Balance Sheet Define each asset and liability classification appearing on a balance sheet A classified balance sheet presents information about an entity’s assets, liabilities, and shareholders’ equity that is aggregated (or “classified”) into subcategories of accounts. … Read more
TOPIC 7: FINANCIAL STATEMENTS | B/KEEPING FORM 3 General Purpose Financial Statements Describe general purpose financial statements Financial Statements Definition: Financial statements are a collection of reports about an organization’s financial results, financial condition, and cash flows. They are useful for the following reasons: To determine the ability of a business to generate cash, and … Read more
TOPIC 6: BAD DEBTS | B/KEEPING FORM 3 The Bad Depts Account Show the bad debts account What are bad debts? The term bad debts usually refers to accounts receivable (or trade accounts receivable) that will not be collected. However, bad debts can also refer to notes receivable that will not be collected. The bad debts … Read more
TOPIC 5:DEPRECIATION | B/KEEPING FORM 3 Cost of a Fixed Asset Determine the cost of a fixed asset Depreciation is the systematic reduction in the recorded cost of a fixed asset. Examples of fixed assets that can be depreciated are buildings, furniture, leasehold improvements, and office equipment. The only exception is land, which is not … Read more
TOPIC 4: CAPITAL EXPENDITURE AND REVENUE EXPENDITURE | B/KEEPING FORM 3 Meaning of Capital Expenditure and Revenue Expenditure Give the meaning of capital expenditure and revenue expenditure Capital Expenditure Payments made in cash or cash equivalents over a period of more than one year. Capital expenditures are used to acquire assets or improve the useful … Read more
TOPIC 3: ADJUSTMENTS | B/KEEPING FORM 3 Adjusting entries are accounting journal entries that convert a company’s accounting records to the accrual basis of accounting. An adjusting journal entry is typically made just prior to issuing a company’s financial statements. The Reasons Why the Life of a Business is divided into Accounting Period Explain why … Read more