accounting for business 22 october ii

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ACCOUNTING FOR BUSINESS

AFTERSCHO☺OL – DEVELOPING CHANGE MAKERS

CENTRE FOR SOCIAL ENTREPRENEURSHIP PGPSE PROGRAMME –

World’ Most Comprehensive programme in social entrepreneurship & spiritual entrepreneurship

OPEN FOR ALL FREE FOR ALL


ACCOUNTING FOR BUSINESS

Dr. T.K. Jain.

AFTERSCHO☺OLCentre for social entrepreneurship

Bikaner M: 9414430763

[email protected]

www.afterschool.tk, www.afterschoool.tk

http://www.afterschool.tk/

http://www.afterschoool.tk/


IDENTIFY ERRORS IN THE FOLLOWING AND CORRECT

• (i) Goods bought from goti amounting to As. 5,500 was posted to the credit of his account as As. 5,000.

• (ii) Sales book was overcast by Rs. 10,000.• (iii) While carrying forward the total of one page of the

Purchases Book to the next, the amount of Rs. 12,350 was written as Rs. 13,250.

• (iv) Cartage As. 780 paid on machinery newly acquired was debited to carriage inward account.

• (v) Purchases return to Kap. As. 3,100 were not recorded in purchases returns book but the account of Kap. was duly debited for the amount

• (vi) Drawtngs of goods costing 300 were not recorded in the books of account

• (viiWhite- expenses, As. 670 were posted from cash book to the nominal account as As. 760.


SOLUTION

1. Suspense Dr. 500 to goti credit

2. Sales Dr. To suspense Cr. 10000

3. Suspense Dr. To purchase 900

4. Machinery Dr. to Carriage Inward 780

5. Suspense Dr. To purch. Return 3100

6. Drawing Dr. To purchase 300

7. Suspense dr. To whitewashing 90


What is self balancing ledger?

• These are adjustment ledgers, which help you in matching totals of the ledgers. These include general ledge adjustment account, bought ledger adjustment a/c and sales ledger adjustment a/c


Find the errors & rectify (these errors are located in next financial

year) • (i) Rs. 8,000 paid for purchase of office furniture

was posted to the purchases account.• (ii) The sales book was overcast by Rs. 100.• (iii) Wages paid for installation of machinery, As.

2,750 had been debited to wages account as Rs. 5,250

• (iv) A cheque for Rs. 7,330 was received from Kap after allowing him a discount of Rs. 70. It was endorsed in favour of Goti in full settlement of Rs. 7,500. The cheque was dishonoured, but no entry for dishonour was passed in the books.


Solution

1. Furniture Dr. To P& L Adjust. Cr. 8000

2. P& L Adjustment Dr. To Suspense Cr. 100

3. Machinery Dr. 2750, Suspense Dr. 2500, P&L Adjustment cr. 5250

4. Kap Dr. 7400 P& L Adjustment Dr. 100

Goti Credit 7500 answer.


What is AS 6?

• Depreciation Accounting


Suppose our institution receives Govt. Grants. Which Accounting

standard is followed? • AS 12


We want to capitalise borrowing cost, which accounting standard

follows? • AS 16


What is the depreciation during last year? • Goti Ltd. which depreciates its machinery © 10% per

annum according to diminishing balance method, had on 1st April, 2006 Rs. 4,86,000 balance in its machinery account. During the year ended 31st March, 2007, the machinery purchased on 1st April, 2004 for Rs. 60,000 was sold for Rs. 40,000 on 1st October, 2006 and a new machinery costing Rs. 70,000 was purchased and installed on the same date; installation charges being Rs. 5,000. The company wants to change its method of depreciation from diminishing balance method to straight line method w.e.f. 1St April, 2004 and adjust the difference before 31St March, 2007, the rate of depreciation remaining the same as before.


Solution

• First find the value of assets on 1 apr. 2004. it is 486000*100/90 * 100/90 = 600000

• Thus using straight line, the depreciation for 2 years is 120000. Thus opening machinery is 480000. Machine of 60000 was sold so its written down value is 48000. its 6 month depreciation will be 3000.


Solution

• We purchased an assets of 75000, so its depreciation is 3750.

• Depreciation on remaining assets: • 54000. • Total depreciation = • 54000+3750+3000 = 60750 • Plus, we have to add depreciation of last

years also. 486000 – 480000 = 6000• Thus depreciation charged this year is 66750

answer


ABOUT AFTERSCHO☺OL

Afterschoool conducts three year integrated PGPSE (after class 12th along with IAS / CA / CS) and 18 month PGPSE (Post Graduate Programme in Social Entrepreneurship) along with preparation for CS / CFP / CFA /CMA / FRM. This course is also available online also. It also conducts workshops on social entrepreneurship in schools and colleges all over India – start social entrepreneurship club in your institution today with the help from afterschoool and help us in developing society.


Why such a programme?

• To promote people to take up entrepreneurship and help develop the society

• To enable people to take up franchising and other such options to start a business / social development project

• To enable people to take up social development as their mission

• To enable people to promote spirituality and positive thinking in the world


Who are our supporters?

• Afterschoolians, our past beneficiaries, entrepreneurs and social entrepreneurs are supporting us.

• You can also support us – not necessarily by money – but by being promotor of our concept and our ideas.


About AFTERSCHO☺OL PGPSE – the best programme for developing great

entrepreneurs• Most flexible, adaptive but rigorous programme• Available in distance learning mode• Case study focused- latest cases

• Industry oriented practical curriculum• Designed to make you entrepreneurs – not just

an employee• Option to take up part time job – so earn while

you learn • The only absolutely free course on internet


Workshops from AFTERSCHO☺OL

• IIF, Delhi• CIPS, Jaipur• ICSI Hyderabad Branch• Gyan Vihar, Jaipur• Apex Institute of Management, Jaipur• Aravali Institute of Management, Jodhpur• Xavier Institute of Management, Bhubaneshwar • Pacific Institute, Udaipur• Engineering College, Hyderabad


Flexible Specialisations:

• Spiritualising business and society• Rural development and transformation• HRD and Education, Social Development• NGO and voluntary work• Investment analysis,microfinance and inclusion • Retail sector, BPO, KPO• Accounting & Information system (with CA / CS /CMA)• Hospital management and Health care• Hospitality sector and culture and heritage• Other sectors of high growth, high technology and social

relevance


Salient features:• The only programme of its kind (in the whole world)• No publicity and low profile course• For those who want to achieve success in life – not just a

degree• Flexible – you may stay for a month and continue the rest of

the education by distance mode. / you may attend weekend classes

• Scholarships for those from poor economic background• Latest and constantly changing curriculum – keeping pace

with the time• Placement for those who are interested• Admissions open throughout the year • Latest and most advanced technologies, books and study

material


Components • Pedagogy curriculum and approach based on IIM Ahmedabad and ISB

Hyderabad (the founder is alumnus from IIMA & ISB Hyderabad)• Meditation, spiritualisation, and self development • EsGotitial softwares for business• Business plan, Research projects• Participation in conferences / seminars• Workshops on leadership, team building etc. • Written submissions of research projects/articles / papers• Interview of entrepreneurs, writing biographies of entrepreneurs• Editing of journals / newsletters• Consultancy / research projects • Assignments, communication skill workshops• Participation in conferences and seminars• Group discussions, mock interviews, self development diaryng • Mind Power Training & writing workshop (by Dr. T.K.Jain)


Pedagogy

• Case analysis,• Articles from Harvard Business Review • Quiz, seminars, workshops, games, • Visits to entrepreneurs and industrial visits• PreGotitations, Latest audio-visuals• Group discussions and group projects• Periodic self assessment• Mentoring and counselling• Study exchange programme (with institutions out of

India)• Rural development / Social welfare projects


Branches

• AFTERSCHO☺OL will shortly open its branches in important cities in India including Delhi, Kota, Mumbai, Gurgaon and other important cities. Afterschooolians will be responsible for managing and developing these branches – and for promoting social entrepreneurs.


Case Studies

• We want to write case studies on social entrepreneurs, first generation entrepreneurs, ethical entrepreneurs. Please help us in this process. Help us to be in touch with entrepreneurs, so that we may develop entrepreneurs.


Basic values at AFTERSCHO☺OL

• Share to learn more• Interact to develop yourself• Fear is your worst enemy• Make mistakes to learn • Study & discuss in a group• Criticism is the healthy route to mutual support

and help • Ask fundamental questions : why, when, how &

where?• Embrace change – and compete with yourself

only


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