3 Study Period 1 continued Were you awake? If you've been concentrating, you should be able to answer some key questions. Who are the users of financial information? What are the main financial statements? What are the desirable qualities of good accounting information? Expenditure on a desk is revenue expenditure. True or false? Any problems? Email (accaqueries @bpp.com) fax (020 8740 2293) or phone us (020 8740 2242/2245) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 1: Intro and the regulatory framework Learn interactively BPP i-Learn/BPP Virtual Campus Module 1 Improve your study skills BPP's Learning to Learn Accountancy book * * Included within your Home Study course If you want any of these products, visit: www.bpp.com/acca Common Pitfalls • Ignoring the needs of the different user groups • Confusing capital and revenue expenditure 4 Study Period 2 The accounting equation Priority = Medium Date due: Exam Guidance The accounting equation may be needed for incomplete records questions (see Study Period 18). Guidance through the Study Text These topics are covered in Chapter 2 The accounting and business equations. Section Approach Essential points 1 Assets and liabilities and the business entity Read through carefully. Definitions of assets and liabilities; business entity convention 2 The accounting equation (or balance sheet equation) Work through quickly, paying particular attention to the examples. The accounting equation; nature of capital and drawings (withdrawals on account of profit) 3 Payables and receivables Make sure you understand this Learn the definitions of receivables and payables Try Question 2 in the Exam Question Bank of your Study Text Exam focus point This equation will never form the basis of a whole exam question, but will form the background to most accounting problems. 5 Study Period 2 continued Were you awake? If you've been concentrating, you should be able to answer some key questions. A business is always treated separately from its owners for accounting purposes. True or false? State the accounting equation. What are drawings (withdrawals of profit) and how are they treated? Give one example each of an asset, a liability, a receivable and a payable. Any problems? Email (accaqueries @bpp.com) fax (020 8740 2293) or phone us (020 8740 2242/2245) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 1: Intro and the regulatory framework Learn interactively BPP i-Learn/BPP Virtual Campus Module 1 Improve your study skills BPP's Learning to Learn Accountancy book * * Included within your Home Study course If you want any of these products, visit: www.bpp.com/acca Common Pitfall • Just learning the accounting equation, without knowing how to apply it in practice 6 Study Period 3 Basic financial statements Priority = High Examined: 6/05 Date due: Exam Guidance You will usually be asked to produce an income statement or a balance sheet for a limited liability company (see Study Period 19). Therefore this study period is extremely important for your future studies. Guidance through the Study Text These topics are covered in Chapter 3 Basic financial statements. Section Approach Essential points 1 The balance sheet Read through carefully. Layout of the balance sheet 2 The income statement Read through carefully. Layout of the income statement Exam focus point The June 2005 exam required the preparation of a balance sheet for a limited liability company. 7 Study Period 3 continued Were you awake? If you've been concentrating, you should be able to answer some key questions. Give examples of current and non-current liabilities. What is a non-current asset? Give examples of three current assets. Any problems? Email (accaqueries @bpp.com) fax (020 8740 2293) or phone us (020 8740 2242/2245) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 1: Intro and the regulatory framework Learn interactively BPP i-Learn/BPP Virtual Campus Module 2 Improve your study skills BPP's Learning to Learn Accountancy book * * Included within your Home Study course If you want any of these products, visit: www.bpp.com/acca Common Pitfalls • Failure to learn the proforma layouts of the balance sheet and income statement • Failing to appreciate the differences between current and non-current assets, and current and non-current liabilities 8 Study Period 4 Sources, records and the books of original entry Priority = Medium Date due: Exam Guidance Books of original entry form one of the bases of double entry bookkeeping and so you should gain a thorough understanding of this topic as background knowledge for your future studies. Guidance through the Study Text These topics are covered in Chapter 4 Sources, records and the books of original entry. Section Approach Essential points 1 The role of source documents Skim through quickly. 2 The need for books of original entry Work through quickly. 3 Sales and purchase day books Work through this very carefully. Format of sales and purchases day books 4 Cash books Pay particular attention to this section. Format of the cash book Try Questions 4 and 5 in the Exam Question Bank of your Study Text Exam focus point Books of original entry are often examined in MCQs. 9 Study Period 4 continued Were you awake? If you've been concentrating, you should be able to answer some key questions. What use are books of original entry? List the books of original entry and the transactions recorded in each. All sales are recorded in the sales day book. True or false? What is recorded in the cash book? Any problems? Email (accaqueries @bpp.com) fax (020 8740 2293) or phone us (020 8740 2242/2245) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 2: Double entry, assets and liabilities Learn interactively BPP i-Learn/BPP Virtual Campus Module 3 Improve your study skills BPP's Learning to Learn Accountancy book * * Included within your Home Study course If you want any of these products, visit: www.bpp.com/acca Common Pitfall • Using the sales and purchase day books to record all sales and purchases. Only credit sales and purchases should be recorded 10 Study Periods 5 & 6 Ledger accounting and double entry Priority = High Date due: Exam Guidance Double entry is an essential topic to understand for the exam. For example, control accounts questions require the use of double entry in the answer. Two study periods have been scheduled for this section. Guidance through the Study Text These topics are covered in Chapter 5 Ledger accounting and double entry. Section Approach Essential points 1 Why do we need ledger accounts? Read through this quickly. 2 The nominal ledger Skim read this section. 3 Double entry bookkeeping Work very carefully though this section and make sure you understand the examples. The dual effect behind double entry bookkeeping: debits and credits 4 The journal Read through carefully. The use of the journal 5 – 6 Skim read these sections. 7 The receivables and payables ledgers Read this carefully. Use of the receivables and payables ledgers to show what each individual customer owes and what is owed to each individual supplier 8 Accounting for a sales tax Work though this section slowly and make sure you understand the principles involved. The accountancy treatment of input and output sales tax Try Questions 6. 7 and 8 in the Exam Question Bank of your Study Text Exam focus point The examiner likes to test double entry principles. Be prepared for questions that ask you to 'journalise' transactions to illustrate the double entry involved. 11 Study Periods 5 & 6 continued Were you awake? If you've been concentrating, you should be able to answer some key questions. What do debits and credits represent? What is the basis of the double entry system? Summarise the double entry for output sales tax. Summarise the double entry postings from the sales day book. Any problems? Email (accaqueries @bpp.com) fax (020 8740 2293) or phone us (020 8740 2242/2245) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 2: Double entry, assets and liabilities Learn interactively BPP i-Learn/BPP Virtual Campus Module 2 Improve your study skills BPP's Learning to Learn Accountancy book * * Included within your Home Study course If you want any of these products, visit: www.bpp.com/acca Common Pitfalls • Confusing the receivables account in the nominal ledger with the memorandum receivables ledger (and similarly for the payables account/payables ledger) • Not appreciating that the receivables and payables ledgers are not part of the double entry system • Confusing input and output sales tax • Lack of understanding of the treatment of sales tax in the income statement and the balance sheet 12 Study Period 7 From trial balance to financial statements Priority = High Date due: Exam Guidance This is very important as exams at all levels in Financial Accounting involve preparation of final accounts from the trial balance. This chapter continues the fundamental principles of accounting and introduces you to the techniques you will employ in exam questions. Guidance through the Study Text These topics are covered in Chapter 6 From trial balance to financial statements. Section Approach Essential points 1 The trial balance Read through this section very carefully. How to balance off accounts and prepare a trial balance 2 The income statement Pay particular attention to this section. Learn the entries made to the income statement 3 The balance sheet Pay particular attention to this section. Pay particular attention to the drawings and capital accounts 4 Balancing accounts and preparing financial statements Work though the questions very carefully. Make sure that you understand the answer to Question 3 and can reproduce the answer yourself without looking at the book. Try Questions 15, 19, and 20 in the Exam Question Bank of your Study Text Exam focus point Most accounts preparation questions will start with a trial balance or draft statements, which need to be adjusted for publication. There are usually several MCQs on the correction of errors. . @bpp.com) fax ( 020 8740 22 93) or phone us ( 020 8740 22 42/ 224 5) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 2: Double entry,. @bpp.com) fax ( 020 8740 22 93) or phone us ( 020 8740 22 42/ 224 5) Learning Resource Centre What do you want to do? How to do it! Reference Test your knowledge BPP i-Pass * Session 2: Double entry,. assets. Any problems? Email (accaqueries @bpp.com) fax ( 020 8740 22 93) or phone us ( 020 8740 22 42/ 224 5) Learning Resource Centre What do you want to do? How to do it! Reference