Fa Ii

Addis Ababa University
College of Business and Economics

Department of Accounting and Finance
Course Number AcFn1032
Course Title Fundamentals of Accounting II
ETCTS Credits 5
Contact Hrs per week 3
The course has the general objective of introducing students to the accounting
basics of recognizing, measuring, and reporting common balance sheet items.
Course
Upon the successful completion of this course, the students will be expected to:
Objectives &
Competences to  Analyze and record payroll transactions in Ethiopian context.
be Acquired  Utilize and identify the implication of the various methods of valuation in
respect to accounts and notes receivable, inventories, depreciation,
tangible and intangible assets, and natural resources.
 Analyze, record and report transactions for businesses organized as
partnerships, private limited companies, and share companies
Course This course is a continuation of Principles of Accounting I. The course is
Description designed to introduce students to the application of accounting principles and
concepts to major balance sheet items. The specific topics includes internal
control over cash, accounting for receivables, accounting for inventories,
accounting for current liabilities, accounting for plant asset, natural resources
and intangibles and accounting for businesses organized as partnerships and
companies as per Ethiopian Commercial Code.
WEEKS Course Contents Reading
3 WEEKS 1. Inventories
{1ST,2ND&3RD } 1.1. Nature and definition of inventories
1.2. Internal control of inventories
1.3. The effect of inventory errors on the financial statements
1.4. Inventory cost flow assumptions
1.5. Inventory costing methods under a perpetual and periodic
inventory system
1.6. Valuation of inventory at other than cost ( lower of cost and net
realizable value.)
1.7. Estimating inventory costs
1.8. Presentation of merchandise inventory in the financial
statements
3 WEEKS 2. PPE , Intangible Assets and Natural resources
{ 4TH ,5TH& 2.1. PPE
6TH }
i. Nature of PPE
ii. Cost of PPE(Measurement at the time of recognition)
iii. Measurement after recognition
a. Depreciation of PPE
b. Capital expenditures and revenue expenditures
iv. Disposal(De-recognition) of PPE
v. Internal controls of plant assets
vi. presentation of PPE on the balance sheet
2.2. Intangible Assets
i. Nature and classification of Intangible assets
ii. Recognition and measurement at the time of
acquisition.
iii. Measurement after acquisition (Amortization).
iv. presentation of intangible assets on the balance
sheet
2 WEEKS 3. Current Liabilities
{ 7TH&8TH }
3.1. The nature of liabilities
3.2. Short-term notes payable
3.3. Ethiopian Payroll System
3.4. Presentation of liabilities on the balance sheet
3 WEEKS 4. Accounting for Partnerships
{9TH ,10TH&11TH
4.1. Basic characteristics of partnership
}
4.1.1. As per the Ethiopian Commercial Code
4.1.2. As per USA Partnership Act
4.2. Equity reporting for partnerships
4.3. Formation of partnerships
4.4. Dividing partnership net income and net loss
4.5. Admission of new partners
4.6. Withdrawal or death of partners
4.7. Liquidating partnerships
5. Accounting for Corporations
5.1. Basic characteristics of Corporations
5.1.1. As per the Ethiopian Commercial Code
5.1.2. As per USA Corporate law
5.2. Classes of shares
5.3. Issuing shares
5.4. Treasury shares transactions
5.5. Accounting for dividends
5.6. Earnings per share
Teaching & Learning The teaching and learning methodology include lecturing, discussions,
Methods/strategy problem solving, and analysis. Take-home assignment will be given at the
end of each chapter for submission within a week. Solution to the
assignments will be given once assignments are collected. Cases with local
relevance will also be given for each chapter for group of students to
present in a class room. The full and active participation of students is
highly encouraged.
Assessment/ The evaluation scheme will be as follows:

Evaluation Component Weight coverage
Tests 30%
Assignments 15% All chapters
Quiz 5%
Final Exam 50% All chapters
Text and Reference Textbook

Books Kieso, D. E., Weygandt, J. J., & Warfield, T. W. (2016). Financial Accounting,
IFRS 3rd Edition, New York: John Willey & Sons.
Reference Books
Warren, C.S., Reeve, J.M., and Duchac, J.E., (2018), Accounting, 27th edition,
Cengage Learning/Any recent edition/
Wild, J.J., and Shaw, K.W., (2018), Fundamental Accounting Principles, 24th
Edition, McGraw-Hill Education
Weygandt, J.J., Kimmel, P.D., and Kieso, D.E., (2018), Accounting Principles,
13th Edition, John Wiley & Sons, Inc.
Wild, J.J., Shaw, K.W., and Chiappetta, B. (2014), Fundamental Accounting
Principles, 22nd Edition, McGraw-Hill Education
Smith, Keith & Stephens, Accounting Principles, 3rd edition and above,
McGraw Hill bookCompany.1989 and beyond.
Hermanson, Edwards and Salmonson, Accounting Principles, 4th ed., Richard

D. Irwin, Inc.1989.
Larson, Kermit D., Fundamental Accounting Principles, 12th edition and

above,Richard Irwin Inc., 1990 and beyond.
Meigs Walter B., Accounting, The Basis for Business Decisions, 6th Ed and
above,McGraw-Hill

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Addis Ababa University

College of Business and Economics

Assessment/ The evaluation scheme will be as follows:

Text and Reference Textbook

Hermanson, Edwards and Salmonson, Accounting Principles, 4th ed., Richard

Larson, Kermit D., Fundamental Accounting Principles, 12th edition and

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