Financial Accounting

The present text has been planned and designed to cope with the needs of B.Com. students of different universities and to present the subject in simple language and lucid style.

Salient features of the Financial Accounting Book

• The subject matter has been arranged and systematized strictly according to the new syllabus and the following thoroughly revised chapters have been included in the present edition:

1. Rules of Debit and Credit: Journal 
2. Sub-Division of Journal: Cash Book
3. Ledger
4. Trial Balance
5. Preparation of Final Accounts
6. Accounting for Non-Trading Organizations
7. Royalties Accounts
8. Hire-Purchase System
9. Installment Payment System
10. Branch Accounts
11. Concept and Accounting of Depreciation
12. Insolvency Accounts

• New chapters on ‘Journal Entries of G.S.T.’ have been included.
• The chapter on Conversion of Partnership into Joint Stock Company has been revised on the basis of the Companies Act, 2013.
• In each chapter of the book, final accounts have been closed on 31st March only and the final accounts pertaining to companies have been prepared in accordance with Schedule III of the Companies Act, 2013.
• The language and style of presentation are very simple and the subject matter has been divided into various headings and sub-headings so as to give flow in studying this numerical subject.
• Both theoretical and numerical aspects of the subject have been given due importance. The numerical illustrations have been carefully graded with supporting theoretical background. In many places, explanatory notes have also been given to clarify the working of the solution.
• Numerical illustrations and questions have been arranged in a systematic and scientific sequence from simple to complex.
• Illustrations and questions both have been arranged in an identical sequence so that students can easily solve the questions after understanding the illustration in the same order.
• In the selection of illustrations and questions priority has been given to the latest university examination papers so that students may make practice according to that standard.

Financial Accounting Syllabus For B. Com. (Honours) Part – I of Patna University

Basic Accounting concepts and conventions; Nature and significance of accounting, types of Accounting. A brief introduction about Journal, Ledger, and Trial Balance and Preparation of Final Accounts.

Accounting of non-trading organizations – Preparation of Receipts and Payments Account, Income and Expenditure Account, and Balance Sheet.

Single Entry System – Preparation of Accounts from incomplete records convention of single entry into Double Entry System.

Royalty, Hire Purchase and Installment Payment System, Departmental and Branch Accounts (including foreign branch), Insolvency Accounts, Partnership dissolution – Simple Dissolution, Insolvency of partners – Garner Vs. Murry case; Conversion of a firm into the company.

Financial Accounting Syllabus For B. Com. (Honours) Semester I of Patna Women’s College 

Unit 1: Theoretical FrameWork – (a) Accounting as an information system, the users of financial accounting information and their needs. Qualitative characteristics of accounting information. Functions advantages and limitations of accounting. Branches of accounting. Basis of accounting cash basis and accrual basis. (b) The nature of financial accounting principles Basic Concepts and Conventions entity, money measurement, going concern, cost, realization, accruals, periodicity, consistency, prudence(conservatism), materiality, and full disclosures. (c) Accounting standards1 to 10: Concept, benefits, the procedure for issuing accounting standards in India. Salient features of an Accounting standard.

Unit 2: Business Income – (a) Accounting for Non-Profit organizations: Preparation of Income and Expenditure A/c and Balance Sheet. (b) The nature of depreciation. The accounting concept of depreciation methods of computing depreciation straight-line method and diminishing balance method, change in the method of depreciation, Sinking Fund Method. (c) Royalty Accounting.

Unit 3: Accounting for Hire Purchase and Installment Systems

Unit 4: Accounting for Inland Branches – (a) Concept of dependent branches; accounting aspects; Independent branches: Concept – accounting treatment important adjustment entries and preparation of profit and loss account and balance sheet. (b) Accounting of Dissolution of the Partnership firm. Including Insolvency of partners, sale to an Ltd. Company. (c) Insolvency A/c.

Financial Accounting Book Contents

1. Meaning and Scope of Accounting
2. Accounting Concept and Conventions
3. Accounting Standards (Including International Financial Reporting Standards (IFRS) and Indian Accounting Standards)
4. Concept of Double Entry System
5. Rules of Debit and Credit: Journal
6. Journal Entries of G.S.T.
7. Sub-Division of Journal: Cash Book
8. Ledger (Including Rules of Posting)
9. Trial Balance
10. Capital and Revenue
11. Adjustment Entries
12. Final Accounts (Manufacturing Account, Trading Account, Profit & Loss Account and Balance Sheet)
13. Branch Accounts
14. Hire-Purchase System
15. Installment Payment System
16. Royalty Accounts
17. Insolvency Accounts
18. Departmental Accounts
19. Accounting for Non-trading (Non-profit) Organizations (Receipts and Payments Account, Income and Expenditure Account and Balance Sheet)
20. Dissolution of Partnership Firm—1
21. Dissolution of Partnership Firm—2 (With Insolvency of Partner)
22. Piecemeal Distribution
23. Conversion of Partnership Into a Joint Stock Company and Sale of Partnership Business
24. Concept and Accounting of Depreciation
25. Single Entry System