COURSE TITLE
:
FINANCIAL ACCOUNTING
COURSE CODE
:
ACC 418
TITLE
:
PRINCIPLES OF DOUBLE – ENTRY,
BOOK OF ACCOUNTS AND TRIAL
BALANCE
REFF.
:
CHAPTER 3,4,5 AND 15
FINANCIAL ACCOUNTING FOR
NON-
ACCOUNTING STUDENTS
LECTURER
:
KAMARUZZAMAN MUHAMMAD
PRINCIPLES OF DOUBLE ENTRY, BOOK OF
ACCOUNTS AND TRIAL BALANCE
Related Chapters:-
Chapter 3 - Accounting for Inventory
Chapter 4 – Double Entry Principles
Chapter 5 – Balancing Off The Accounts and The Trial Balance
Chapter 15 – Accounting Systems and Books of Accounts
CHAPTER 3 – ACCOUNTING FOR
INVENTORIES
Areas to be covered:-
Define Inventory
Determine the purpose of accounting for inventory
Identify the movement of inventory
Show the effect of the transaction on the accounting equation
INTRODUCTION
Inventories are current assets:-
Held for sales in ordinary course of business
In the process of production for such sales
To be consumed in the production of goods or services for sales
Types of Inventories
Raw Materials -
components on hand waiting to be used in
production.
Work in progress -
inventory in various stages of
production but not yet completed.
Finish good –
inventory which is completed and ready for
sale and
Will be our focus in this class
The purpose of accounting for inventories:-
To value beginning inventories
To value ending inventories
To determine the cost of goods sold
Chapter 3
ACCOUNTING FOR INVENTORIES
Chapter 3
ACCOUNTING FOR INVENTORIES
Increase in inventories
Effect of Transaction
Accounts
Purchase of goods
Purchase expense
increase
Purchase account
Goods return by buyer
Sales revenue decrease
Sales Return or Return
inwards acct
Chapter 3
Effect of Transaction
Accounts
Sale of goods
Sales revenue increase
Sales Account
Goods return to
supplier
Purchase expense
decrease
Purchase returns or
Return outwards
accounts
Decrease in inventories
ACCOUNTING FOR INVENTORIES
