Author: Msomi Bora

  BOOK KEEPING NOTES FOR FORM THREEClick the links below to view the notes:TOPIC 1 – GENERAL JOURNALTOPIC 2 – CORRECTION OF ERRORSTOPIC 3 – ADJUSTMENTSTOPIC 4 – CAPITAL EXPENDITURE AND REVENUE EXPENDITURETOPIC 5 – DEPRECIATIONTOPIC 6 – BAD DEBTSTOPIC 7 – FINANCIAL STATEMENTSTOPIC 8 – BALANCE SHEET (CLASSIFIEDTOPIC 9 – MANUFACTURING ACCOUNTTOPIC 10 – CONTROL ACCOUNTTOPIC 11 – INCOMPLETE RECORDSTOPIC 12 – ACCOUNTS OF NON-PROFIT MAKING ORGANIZATIONSTOPIC 13 – GOVERNMENT BUDGETING PROCEDURE  

TOPIC 13: GOVERNMENT BUDGETING PROCEDURE Government Budgeting Procedur Meaning of a Budget Define a budget How can you create a budget?. Planning for revenues and expenditure is very important in real life, we really have to know about how much coming in and how much money coming out. You will learn how to prepare a scale of preference and priorities you are wants.Watch this video to see you can plan your budget as an individual. Please use a regular YouTube link. A budget is a set of interlinked plans that quantitatively describe an entity’s projected future operations. A budget is used…

TOPIC 12: ACCOUNTS OF NON-PROFIT MAKING ORGANIZATIONS 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 summary takes the form of an account known as receipts and payments account. Such concerns also prepare ‘income and expenditure account’ (which is more or less on the lines of profit and loss account) and the Balance Sheet. The day-to-day accounting consists of maintaining. Cash book for recording receipts…

TOPIC 11: INCOMPLETE RECORDS Incomplete Records 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 final accounts cannot be prepared without further analysis of the records that do exist. Where only records available are the assets and liabilities at the beginning of the year and at the end of the year, it is not possible to prepare a Trading and Profit and…

TOPIC 10: CONTROL ACCOUNT Control Account Control Account from Subsidiary Records Construct control account from subsidiary records Definition: A control account is a summary-level account in the general ledger. This account contains aggregated totals for transactions that are individually stored in subsidiary-level ledger accounts. Control accounts are most commonly used to summarize accounts receivable and accounts payable, since these areas contain a large volume of transactions, and so need to be separated into subsidiary ledgers, rather than cluttering up the general ledger with too much detailed information. The balance in a control account should match the total for the related subsidiary…

TOPIC 9: MANUFACTURING ACCOUNT Manufacturing Account One of the tool to analyse the effects of business transaction is by using the accounting equations. However this conduct of recording transactions in equation form is not common. Instead, businessmen establish their separate records called accounts. The components of those accounts include a record of assets, liabilities and owner’s equity. This accounts help the staff and the owners to prepare, analyse, classify and report financial information. 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…

TOPIC 8: BALANCE SHEET (CLASSIFIED) Balance Sheet (Classified) 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. It is extremely useful to use classifications, since information is then organized into a format that is more readable than a simple listing of all the accounts that comprise a balance sheet. When information is aggregated in this manner, a balance sheet user may find that…

TOPIC 7: FINANCIAL STATEMENTS The preparation of financial statement is very important to business owners and the government. However these statements needs to be presented in a meaningful way, they should be easy to interpret. Financial statements take an account of assets, liabilities and owner’s equity. This help to determine the gross profit on sales and to help the company prepare annual financial plan. Financial Statements Financial analysts rely on data to analyze the performance of, and make predictions about, the future direction of a company’s stock price. One of the most important resources of reliable and audited financial data…

TOPIC 6: BAD DEBTS Bad Debts Suppose that you are the owner of a business and you owe someone. What will you do if the credited customer will not be able ton pay back the company’s debt? In this concept, I will tell you what to do when that issue happen.When the owner of a business become aware that a customer who has been credited will not be able to pay the amount outstanding, it is very important to take an action and the amount due is written off. The account of the credit costumer will be closed and the profit…

TOPIC 5: DEPRECIATION Depreciation If an asset id used for more than one year, it should be capitalized. Assets accounts names such as Vehicles, Office equipment or Buildings. at the end of each accounting period, depreciation for the period is debited to the depreciation expense. Accumulated Depreciation shows all depreciation that has been taken during the asset’s file. 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…