The objective of this course is to acquaint students with the accounting concepts,
tools and Techniques influencing business organizations.

Unit 1: INTRODUCTION TO FINANCIAL ACCOUNTING 10 Hours

Introduction – Meaning and Definition – Objectives of Accounting – Functions of
Accounting – Users of Accounting Information – Limitations of Accounting – Accounting
Principles – Accounting Concepts and Accounting Conventions- problems on accounting
equations.

Unit 2: CONVERSION OF SINGLE ENTRY INTO DOUBLE ENTRY
SYSTEM 14 Hours

Single entry system- Introduction – Meaning – Features – Merits – Demerits – Types.
Conversion into Double Entry system – Need for Conversion – Preparation of Statement
of Affairs – Cashbook – Memorandum Trading Account – Total Debtors Account – Total
Creditors Account – Bills Receivable Account – Bills Payable Account – Trading and Profit
& Loss Account – Balance Sheet.

Unit 3: HIRE PURCHASE SYSTEM 12 Hours

Introduction – Meaning of Hire Purchase and installment purchase system- difference
between hire purchase and installment purchase – Important Definitions – Hire
Purchase Agreement – Hire Purchase Price – Cash Price – Hire Purchase Charges – Net
Hire Purchase Price – Net Cash Price – Calculation of Interest – Calculation of Cash Price
– Journal Entries and Ledger Accounts in the books of Hire Purchaser and Hire Vendor
(Asset Accrual Method only). Problems on hire purchase including default and complete
repossession of goods.

Unit 4: ROYALTY ACCOUNTS 12 Hours

Introduction – Meaning – Technical Terms – Royalty – Landlord – Tenant – Minimum
Rent – Short Workings – Recoupment of Short Working under (Fixed Period) restrictive
and non-restrictive (Floating Period) Recoupment within the Life of a Lease – Treatment
of Strike and Stoppage of work – Accounting Treatment in the books of Lessee and
lessor – passing of journal entries and Preparation of necessary Ledger Accounts
including minimum rent account.

Unit 5: CONVERSION OF PARTNERSHIP FIRM INTO A LIMITED COMPANY – 12 Hrs

Introduction – Need for conversion - Meaning of Purchase Consideration – Mode of
Discharge of Purchase Consideration – Methods of calculation of Purchase Consideration
– Net Payment Method – Net Assets Method – Passing of Journal Entries and Preparation
of Ledger Accounts in the books of Vendor – Treatment of certain items – Dissolution
Expenses – Unrecorded Assets and Liabilities – Assets and Liabilities not taken over by
the Purchasing Company – Contingent liabilities – Non-assumption of trade liabilities – In
the books of Company – Passing of Incorporation entries and preparation of balance
sheet under vertical format.

SKILL DEVELOPMENT

• List out various accounting concepts and convections ( GAAP)
• Collection & recording of Royalty agreement with regard to any suitable situation.
• Collection and recording of Hire Purchase Agreement.
• Ascertainment of Cash Price and Interest under Hire Purchase System.
• Draft Joint venture agreement with regard to any suitable situation
BOOKS FOR REFERENCE

1) Dr. S.N. Maheswari: Financial Accounting
2) B. S Raman: Financial Accounting
3) S P Jain and K. L. Narang: Financial Accounting- I 8

4) Radhaswamy and R.L. Gupta: Advanced Accounting
5) Jawaharlal & Seema Srivastava :Financial Accounting,HPH
6) Guruprasad Murthy: Financial Accounting
7) Dr. Anil Kumar,Dr. Rajesh Kumar, B.Mariyappa : Financial Accounting
8) S. Jayapandian: Financial Accounting from Zero.

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