This means that the underlying purpose of Accounting is to provide financial information about an economic entity (business enterprise Increase one asset, decrease another asset, and increase a liability. The shareholders who provide capital and carries the risk of the firm /business. The matching principle governs the timing of expense recognization in financial statements. Not all happenings of a business can be expressed in monetary terms although they may significantly affect the business. Assets should not be over valued and liabilities or obligations should not be under valued. Now we shall describe or explain each of the major components. They should base their estimates on sound logic and select those accounting methods which either overstate nor under state the facts. 12) Conservatism For each of the transactions (a)through (e) you are to write a separate sentence explaining the nature of the transaction. Business Transactions BCOM 2nd Semester Question Papers 2014 to 2015 3. Write about E … Revenues are increases in owners equity from the sale of goods or performance of services. Decrease an asset and decrease a liability. To receive study notes directly to your email, CALL / TEXT / Whatsapp 0724 962 477. They depend on the auditor to verify the dependability of the information the statements contain. Clearly distinguish internal and external business transactions. Corporate Accounting study material includes corporate accounting notes, corporate accounting book, courses, case study, corporate accounting syllabus, question paper, MCQ, questions and answers and available in corporate accounting pdf form. Sold equipment for cash at a price below its cost. KNEC| KASNEB| KISM| Study notes and Revision materials for schools in Kenya. 3. In other words the two sides are the same view of the business property. What factors determine the development of these principles. In addition to auditing , accountants commonly offer management advisory services. Accounting system can be classified broadly into. Accountants should recognize revenue when it has been realizedi.e. Information about funds, costs, profits etc. For this reason therefore the current market value of the assets are of little importance to  decision makers. A cash 50%  down payment was made with payment of the balance to be made within 60days. The final line in the table corresponds to the amounts in the balance sheet at the end of September. After several years of experience with a practicing firm of certified public accountants, Jostone resigned from his position on September 1, 2001, in order to begin a public accounting practice of his own, named Jostone $ Sons. All these notes and eBooks for BCom 5th semester will help you study and prepare well for your semester exams. By this transaction an new asset, A/C receivable was acquired but the Asset land was decreased by the same amount.- No charge in total assets. MIT OpenCourseWare is a free & open publication of material from thousands of MIT courses, covering the entire MIT curriculum.. No enrollment or registration. 6) Time Period Principle / periodicity Principle Creditors who provide loans to the business. The private accountant may design or help the public accountant design the system used in recording the transactions. Or the accounting equation, since all double entry accounting is based on it. When balance sheet equality is expressed in equation form, the resulting equation is called the balance sheet equation. Get the complete study material, ppt, courses, question paper, mcq. Have you attempted mock tests or practice tests yet? Regardless of type of asset, it represents revenue. As a result gains are reported on sale of assets where there has, infact ,been little or no gain in purchasing power. The transactions listed below occurred during the organization of sub expert service, a refrigeration repair business. This means Accounting includes the design of accounting systems, preparation of financial statements, audits, studies , development of forecasts, income tax work, computer applications to accounting processes, and the analysis and interpretation of accounting information as an aid to making business decisions. The balance sheet reports the financial position of a business at a specific point in time. A balance sheet is so called because its two sides must always balance. List the following four column headings on a sheet of paper as follows: Transaction Total assets Liabilities                          Owner’s Equity. However,regardless of what transactions a business completes, its accounting equation must remain in balance. Download KASNEB CPA Notes New syllabus here.Click on the respective units to download the sample copies for quality confirmation. Two ways: Accounting Equation (Balance Sheet Equation). Sept 1 Started a business by depositing Ksh. In some cases cash may be paid out before the expense is incurred as for example payment for next years rent. A price of 36,000/= was agreed upon which involved the cost of moving the building and installing it upon Roberts Company Ltd. There have been occasions when assistants have not completed work to the satisfaction of management but when asked to explain, Ngura explains that employees know what is expected of them and they should therefore work, for they are paid for it.Required: Identify and explain the weaknesses in Ngura’s style of management and suggest measures that should be taken to address the weaknesses, Know the users and purpose of accounting information, Know and understand the underlying accounting principles, Understand the career prospects of accountants. This can accomplished either in the University’s department of Accountancy and score high in exams assets assets are resources. 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