Maintain balance tracking for advances relating to sales and purchases.
Subscription Accounts
Role of subscription accounts in revenue tracking.
Record subscription income over various years (e.g., 2017-2018 to 2019-2020).
Handle outstanding and advance subscriptions properly in account statements.
Income and Expenditure Account
Key to summarize all income and expenses, making adjustments necessary for prior years, and ensuring outstanding amounts are tracked correctly.
Formula for determining surplus or deficit:
Surplus: Income > Expenditure
Deficit: Expenditure > Income
Cash Flow Statement
Comprises three sections:
Cash flows from Operating Activities
Cash flows from Investing Activities
Cash flows from Financing Activities
Calculate net profit from balance sheet and adjustments for non-operating expenses.
Debentures
Basic entries when issuing debentures, whether at a premium or discount.
Understand the treatment concerning vendor payments and collateral security implications in debenture transactions.
Interest payments on debentures and requisite accounting entries.
Retirement and Settlement of Partners
Calculation of new and gaining ratios upon partner retirement.
Treatment of goodwill and other reserves during partner retirement accounting.
Specific focus on the treatment of expenses related to partners’ accounts.
Key Concepts and Judgements
Adjustments: Importance of incorporating previously outstanding amounts into current calculations.
Provisions: Understand the necessity of creating provisions for taxation and doubtful debts within the accounting framework.
Benefits: Key to delivering comprehensive understanding for exam preparations.
Conclusions
This overview is meant to enhance your understanding of core accounting concepts related to fund accounting, consumer goods, subscription accounts, cash flow statements, debt instruments, and partnership settlements.
Make sure to review these concepts and practice the calculations to solidify your learning.