A/C I

ACC 101.3 (Credit hours 3)

Financial Accounting I

BCA, First Year, Second  Semester

Course Objectives:

            This course aims to provide students with the basic concept and practices of Financial accounting with a view to develop their skills in preparing and presenting the financial statements of an organization as part of the accounting information system.

Course Contents:                                                                                                                              4 hours

1. Introduction  

Concept of accounting, forms of business organization and nature of business activity; users of accounting information and their needs; fields of accounting; financial statements: the tools for communication; generally accepted accounting principles; qualitative characteristic of accounting information; objectives of financial statements; the accounting profession.

2. Recording, Handling and Summarizing the Accounting Information                                     9 hours

Role of source documents, Recording of transaction and events, the accounting equation; the double entry system; analysis of transaction; rules of debits and credits for assets, expenses, liabilities, capital and income; cash accrual and hybrid system of accounting; journal-general and special including cash and bank books; role of vouchers, T-accounts; trial balance; concepts of the annual report and financial statements.

3. Income Statement                                                                                                                          4 hours

Concepts of income statement; major components of income statements: revenues, cost of sales, gross margin, administrative expenses, selling and distribution expenses, gains and losses, net income and retained earnings; formats of income statements; retained earning statements, preparation of income statement (Vertical multi-step format) 

4. Balance Sheet                                                                                                                                4 hours

Concepts of balance sheet; major components of balance sheet: assets, liabilities and stockholder's equity; preparation of balances sheet (vertical, classified format)

5. Work Sheet                                                                                                                                    8 hours

Accrual and adjusting entries; T-accounts, opening and closing entries; preparation of income statement and Balance sheet with adjustments using a work sheet.

6.Statement of Cash Flows                                                                                                               8 hours

Cash flows and accrual accounting; purpose of the statement of cash flows; operating, investing and financing activities; formats of statement of cash flows; preparation of cash flow statement (vertical format)

7. Annual Repot                                                                                                                                2 hours

Meaning and components of an annual report

8. Accounting Information System and the Use of Computers in Accounting                            9 hours

Accounting information system in modern business organizations; role of computers in accounting; recording transactions, extracting ledger, trial balance and presenting the financial statements received from the accounting package; using computerized accounting software; retrieving various reports from the system

Text Book

1. Porter, Gary A. Norton, Curtis L., Financial Accounting: The Impact on Decision Makers, The Dryden Press, USA.

Reference Books:

1. R. Narayanswamy, Financial Accounting: A Managerial Perspective, Prentice Hall of India.
2. Accounting Package
3. Sharma, Narendra, Acharya, C: Financial Accounting, Budha Academic Centre