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    Management Accounting Tutorial Note 1

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    Nathaniel Mensah
    This document provides an overview of management accounting topics including the accounting equation, cash book reconciliation, inventory management, theories and budgeting. It also defines accounting as identifying, measuring and communicating financial information to allow for informed decision making. Accounting is described as an information system that accepts inputs, processes them, and produces outputs to link business activities and decisions. The document outlines internal and external users of accounting information and defines key financial statements including the income statement, balance sheet, statement of cash flows, statement of changes in equity, and notes to the financial statements.

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    Management Accounting Tutorial Note 1

    Uploaded by

    Nathaniel Mensah
    15 views5 pages
    This document provides an overview of management accounting topics including the accounting equation, cash book reconciliation, inventory management, theories and budgeting. It also defines accounting as identifying, measuring and communicating financial information to allow for informed decision making. Accounting is described as an information system that accepts inputs, processes them, and produces outputs to link business activities and decisions. The document outlines internal and external users of accounting information and defines key financial statements including the income statement, balance sheet, statement of cash flows, statement of changes in equity, and notes to the financial statements.

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    MANAGEMENT ACCOUNTING TUTORIAL NOTE 1

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    This document provides an overview of management accounting topics including the accounting equation, cash book reconciliation, inventory management, theories and budgeting. It also defines accounting as identifying, measuring and communicating financial information to allow for informed decision making. Accounting is described as an information system that accepts inputs, processes them, and produces outputs to link business activities and decisions. The document outlines internal and external users of accounting information and defines key financial statements including the income statement, balance sheet, statement of cash flows, statement of changes in equity, and notes to the financial statements.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    15 views5 pages

    Management Accounting Tutorial Note 1

    Uploaded by

    Nathaniel Mensah
    This document provides an overview of management accounting topics including the accounting equation, cash book reconciliation, inventory management, theories and budgeting. It also defines accounting as identifying, measuring and communicating financial information to allow for informed decision making. Accounting is described as an information system that accepts inputs, processes them, and produces outputs to link business activities and decisions. The document outlines internal and external users of accounting information and defines key financial statements including the income statement, balance sheet, statement of cash flows, statement of changes in equity, and notes to the financial statements.

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    © All Rights Reserved
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    of 5

    MANAGEMENT ACCOUNTING

    IA’S
    1. EFFECT OF ACCOUNTING EQUATION 20MARKS
    A=E+L

    2. BRS--------CASH BOOK --------- BANK STATEMENT 20 MARKS

    3. INVENTORY MANAGEMENT--- IAS 2

    EXAMS
    1. THEORIES ----- DEFITION, STATE, EXPLAIN, OUTLINE (PRECISE
    AND CONCISE) 20 MARKS

    2. BUDGETING ----- FINANCIAL ASPECT FUTURE ORIENTED


    PROFIT ---- 30 MARKS

    3. DECISION MAKING ANALYSIS (20 MARK)


    MAKE OR BUY
    SPECIAL OFFER
    ECONOMIC DECISION---QUANTITY OF PRODUCT

    4. FINANCIAL STATEMENT ANALYSIS 30 MARKS


    ACCOUNTING

    DEFINITION
    Is a process? (Scientific) identifying, measuring, and communicating financial
    information to end users in order make an informed decision.

     Identifying --- Data, event, activities, transaction

    WHAT IS A TRANSACTION? Is a business activities


     Two or more parties
     Willingly
     Exchange a valuable (money)
     Arms-length

     Measurement----BOOK KEEPING

    CLASSES OF BOOKS
    1. RECIEPTS (DATA)
    2. JOURNAL == Prime of book of original entry

    SALE JOURNAL---- Goods sold on credit


    Purchases Journal ---- Goods bought on credit
    Return Inwards Joun. ----- Goods returns to firm
    Return Outwards Joun. ----- Goods returns by firm
    General Jounal ------ Every transaction even including
    the above. Other ones CASH, EQUITY
    CASH BOOK--- ALL Cash transaction

    TYPES OF CB
     One column CB --- Only cash
     Two column CB --- Only cash and Bank (cheque)
    Receipt Payment
    Date F/ GH DATE F/L DETIALS GHC
    L C
    2/2/22 Sale 50

    EXAMPLE: SOLD GOODS FOR CASH OF GHC 50

    Sales

    Purchase goods on credit from Ama GHC 40


    DAT. FL DET. CAS BANK DAT. FL DET. CAS BANK
    H H

     3 ‘’ CB --- Only cash, Bank, Discount (Trade and Cash)


    BUSINESS--- DISC ALLOWED
    SUPPLIER--- DISC RECEIVED

     PETTY CB

     LEDGER---- A T- account divided into two halves. (DOUBLE


    ENTRY PRINCIPLE)

    DEBIT EQUITY ACCOUNT CREDIT


    Date. Details GHC Date Details GHC

     Balance off all account


     Trial Balance ----- Show errors
    DETAIL DEBIT CREDIT
    EQUITY 50
    CASH 50

     FINAL ACCOUNT---- FINANCIAL STATEMENT (FINANCIAL


    INFORMATION)

    QUESTION: WHAT IS MEANT TO SAY ACCOUNTING AS AN


    INFORMATION SYSTEM?

    INPUT PROCESS OUTPUT


    Any system that accept input, process it into an output. It links business activities and that
    decision making.

    USER OF ACCOUNTING
    INTERNAL USER--- Within the firm that directly affect by activities of the firm
    E.G Management---- Accountability, Performance, Remuneration, Planning, Liquidation

    Employees’ ---- Wages & Salary, Continuity of business, incentives, share options,
    retirement benefit

    Intermediate ------ Shareholder -----Performance, Dividend—Cash, Share, etc.

    EXTERNAL USER-- --- outside the firm that directly or indirectly affect by activities of the
    firm.

    SUPPLIERS-- Continuity of business, credit worthiness,

    Government agencies… e.g GRA, ----- Taxation, regulation, SEC, BoG, equal share of
    government resources.

    Customers ----- Price strategy, quality, and continuity of business


    Auditors---- External; Free and fair view all activities
    Media ---- Free and fair view all activities Moodys and Moodys--- AA BB (CREDIBLE)
    S&P

    WHAT IS FINANCIAL STATEMENT


    Revenue/Sales
    Expenses
    Asset
    Liabilities
    Equity/Capital
    State the components of a financial statement
     Income Statement/ Profit and Loss Account--- PERFORMANCE
    o REVENUE ---- Cash sales
    Credit sales
    Increase in Asset
    Decrease in liability

    o Expenses ---- Decrease in assets


    Increase liability

    N/B: FOR THE YEAR ENDED

     STATEMENT OF FINANCIAL POSITION / BALANCE SHEET (position)


    Depicts the worth of the firms in terms of its assets, liability and equity.

    ASSET = EQUITY + LIABILITY


    N/B: As at

     STATEMENT OF CASH FLOW


     STATEMENT OF CHANGES IN EQUITY
     STATEMENT OF NOTE TO ACCOUNT

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