ILOCOS SUR COMMUNITY COLLEGE

Quirino Stadium, Zone V, Bantay, Ilocos Sur

Business Administration and Management

COURSE OUTLINE
PRINCIPLES OF ACCOUNTING

I – INTRODUCTION TO ACCOUNTANCY, BUSINESS AND MANAGEMENT

A. Definitions, Nature, and Functions
1. Business
a. Business Processes and Information
b. Business Transactions, Transaction Groups, Counterparties, Transaction Cycles
2. Management
a. Financial Objectives: Survival and Growth
b. Management and Information
c. Management’s Responsibility for Financial Information
B. Definitions, Nature, and Functions of Accounting
1. Accounting, the Language of Business
2. Accounting Definitions, Functions and Processes
3. Role of Accounting in Business Managements Objectives and Decisions
4. Accounting: Similarities and Differences
5. Accounting: Art or Science?
C. Accounting, Business and Management Connection

II – BRANCHES OF ACCOUNTING
A. Accountancy in the Philippines
B. Accounting Standards
C. Branches of Accounting
1. Financial Accounting
2. Management Accounting
3. Cost Accounting
4. Government Accounting
5. Tax Accounting
6. Auditing
7. Accounting Education
8. Accounting Research

III – USERS OF FINANCIAL INFORMATION

A. Internal Users
1. Owners
2. Management
3. Employees
B. External Users
1. Business Organizations and Individuals
a. Potential Investors
b. Present and Potential Creditors and Lenders
c. Present and Prospective Customers
2. Government Sector
3. General Public and Private Sector Groups

IV – FORMS OF BUSINESS ORGANIZATIONS

A. Equity: The Claims Of Owners In The Business
B. Common Forms of Business Organizations
 1. Sole/Single Proprietorship
2. Partnership
3. Corporation
4. One-Person Corporation
5. Cooperative

V – TYPES OF BUSINESS ACCORDING TO ACTIVITIES

A. Service Business
1. Transactions
2. Financial Profile
B. Merchandising Business
1. Transaction
2. Financial Profile
C. Manufacturing Business
1. Transactions
2. Financial Profile
D. The Hybrid
E. Types of Businesses, Financial Objectives, and the Accounting Information System

VI – ACCOUNTING CONCEPTS AND PRINCIPLES

A. Information Reported Through The Accounting Process
B. The Qualitative Characteristics of Useful Information
1. The Fundamental Characteristics of Useful Information
a. Relevance
b. Faithful Representation
2. Enhancing Qualitative Characteristics
a. Comparability
b. Verifiability
c. Timeliness
d. Understandability
3. The Cost Constraint on Useful Financing Reporting
C. Accounting Concepts: Applying The Qualitative Characteristics
1. Inputs: Concepts on the Subject, Basis, Timing, and Environment of Financial Information
a. Separate Entity Theory
b. Objectivity
c. Going Concern Assumption
d. Periodicity
e. Monetary Unit
2. Process: Concepts on the Contents and Processes of Financial Information
a. Recognition Principle
b. Measurement Principle
c. Accrual Accounting
d. Materiality
3. Output: Concepts on Communicating Financial Information Presentation and Disclosures
Principles

VII – ACCOUNTING EQUATION

A. Accounting Elements
1. Elements of Financial Position
2. Elements of Financial Performance
B. Accounting for Transactions Under the Accrual Method
C. Analyzing the Effects of Transactions on the Accounting Equation
D. The Expanded Accounting Equation and Effects of Transactions
E. Summary, Evaluation and Enrichment, Exercises
VIII – TYPES OF MAJOR ACCOUNTS
A. Accounts
B. Assets
C. Liabilities
D. Owner’s Equity
E. Income
F. Expenses
G. The Chart of Accounts

IX – SOURCE DOCUMENTS AND BOOK OF ACCOUNTS

A. The Accounting Cycle
B. Elements and Aspects of Transactions
C. Source Documents
1. Contracts
2. Cash Receipts – Related Documents
3. Cash Disbursements – Related Documents
4. Banking – Related Documents
5. Service Revenue – Related Documents
6. Purchases – Related Documents
7. Personnel – Related Documents
8. Other Source Documents
D. Journals
1. General Journals
2. Special Journals
a. Cash Receipts Journal (CRJ)
b. Cash Disbursements Journal (CDJ)
c. Sales Journal
d. Purchases Journal
E. Ledgers
1. General Ledger
2. Subsidiary Ledgers
F. The Source Documents – Journals – Ledgers Connection

X – BUSINESS TRANSACTIONS AND THE ACCOUNTING CYCLE OF A SERVICE BUSINESS (PART I)

A. Identification: Analysis of the Transactions and Events (Step 1)
B. Journalizing: Recording Transactions and Events (Step 2)
1. The Rules of Debits and Credits of Accounts
2. Real and Nominal Accounts
3. Application of the Rules to the Transaction Groups
C. Posting to the Ledger (Step 3)
D. Preparing the Trial Balance (Step 4)
E. Special Journals and Subsidiary Ledgers

XI – COMPLETING THE ACCOUNTING CYCLE OF A SERVICE BUSINESS (PART II)

A. Preparing the Worksheet (Step 5)
B. Adjusting the Accounting Records (Step 6)
1. How Assets Become Expenses
2. How Service Revenues Are Earned
C. Types of Adjustment
1. Deferrals
2. Accruals
3. Estimates
D. The Double T-Accounts (Work Back) Technique in Adjusting Entries
E. Preparing the Financial Statements (Step 7)
F. Closing Entries (Step 8)
XII – ACCOUNTING CYCLE OF A MERCHANDISING BUSINESS
A. Accounting for a Merchandising Business
B. Financial Profile of the Merchandising Business
1. Cost and Expenses in the Merchandising Business
2. Gross Profit and the Net Income
C. Transactions and Events in the Merchandising Business
1. The Operating Cycle of the Merchandising Business
2. Transactions and Accounts Related to Purchases: The Company as Buyer
3. Transactions and Accounts Related to Sales: The Company as Seller
D. Analyzing and Recording the Merchandising Transactions
1. Source Documents Related to Merchandising Transactions
2. Journalizing
Inventory Systems: Perpetual Inventory System and Period Inventory System
3. Posting to the Ledgers
E. Completing the Accounting Cycle of the Merchandising Business
4. Preparing the Trial Balance
5. Preparing the Worksheet
6. Adjustments
7. Preparing the Financial Statements
8. Closing the Nominal Account

REFERENCES:
Books:
Villaceran, Eugenio V. (2022). Fundamentals of Accountancy, Business and Management 1,
New Edition
Salazar, Dani Rose C. (2021). Fundamentals of Accountancy, Business and Management 2,
Second Edition
Ballada, Win (2022). Basic Financial Accounting and Reporting, 24th Edition
Valix, Conrado; Peralta, Jose; and Valix, Christian Aris (2017 Edition). Financial Accounting,
Volume 1, First Part
Web Resources:
www.akawnting.com
www.businessdictionary.com
you tube links

COURSE EVALUATION AND GRADING SYSTEM:

Class Standing 60%
o Class Participation – 15% (Recitation, Seatwork, Assignment, Activity)
o Assessment – 25% (Evaluation, Quizzes, Long Quiz)
o Output/Major Requirements – 20% (Case Study, Reaction Paper,
Major Exam (Midterm Exam, Final Exam) 40%

COURSE REQUIREMENT
Compilation of Activity Sets

Prepared by:

Villamor P. Cocos, MBA

Instructor