Easy Final Exam Revision Tips for Accounting Students

1. Our Confession ACT 110 Is EASY POP! Because, Finals is Easy!

2. Final Exam Revision

3. Final Exam Revision Date and Time • December 20, 2011 • 9:00am Topics • Sole Proprietorship’s Financial Statements • Trading Profit and Loss A/c – Vertical Format • Balance Sheet – Vertical Format • Cash books • Bank Reconciliation Statements

4. Final Exam Revision Format of Exam • Multiple Choice Questions • 15 Questions from all three topics • Calculations • Three questions and required to answer 2 • Trading and Profit and Loss is compulsory • Choose between Cash Book and bank reconciliation

5. Final Exam Revision What to Study? • Handout – Pages 22 -26 • Work sheets 5 – 7 • Power Point Slides 7 – 11 • Power Point Slides – Question 1 & 5 Answers

6. Final Exam Revision Financial Statements • Accrued Expenses – Added to respective Expense and recorded as a current Liability • Prepaid Expenses – Deducted from respective expense and recorded as a Current Assets • Provision for bad debt • Depreciation – Recorded as an Expense and Deducted from Respective Asset’s at cost figure. • Stock in TB is Opening Stock and Stock in Notes is Closing Stock. • Everything in notes is recorded twice.

7. Final Exam Revision Bank Reconciliation • Reconciliation of the Cash Book bank column Balance with the Bank Statement balance • There are three (3) reasons why they wouldn’t agree with each other: • Items Recorded by the bank and not by the cash book • Items recorded by the cash book and not by the bank • Errors made by either the bank or the cash book.

8. Final Exam Revision Possible Errors • Understated Cheque – Deducted from either balance • Overstated Cheque – Added to either balance • Understated Deposit – Added from either balance • Overstated Deposit – Deducted from to either balance Items not recorded by either • Must know how to treat items not recorded by Cash book or bank. • To do so must know how an items is treated by the other party and record the same

9. Final Exam Revision Items not recorded by either • Example – How would this affect the bank: • Bank Charges • Standing Order. • Dividends received and banked • Payment to creditor • Item previously written off as bad debt, cheque received and banked • Debtor paid direct into Roger’s bank account • Drawings in the form of a cheque • Cheque previously banked now dishonoured.

10. Final Exam Revision Cash Book • Records Cash Receipts and Cash Payment. • Receipt of Cash and Cheques are recorded in Receipts Side Cash Column until banked. • Deposits Directly to the bank by the Customers or the Business are recorded in the Bank Receipts Side Bank Column. • Cash Payments are recorded in Payments Side Cash Column • Cheque Payments are recorded in Payments Side Bank Column.

11. Final Exam Revision Cash Book - Discounts • Discounts Allowed are recorded on Receipts Side Discount Column. • Discount Received are recorded on Payments Side Discount Column. Cash Book – Balancing off • Bank Column Receipts should be balanced with Bank column payments • Cash Column Receipts should be balanced with cash column payments.

12. Final Exam Revision Cash Book – Balancing off • Discount Columns and added and totals put at the bottom.