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Account First Term Scheme of Work and Lesson Notes for Senior Secondary School Three( SSS 3)

First Term Scheme of Work Account for SSS 3

  1. Revision of SS2 Work 
  2. Company income statements
  3. Appropriation Account of a company
  4. Company is balance sheet
  5. Security and Exchange Commission
  6. Security and Exchange  Commission
  7. Nigerian stock Exchange
  8. Hire purchase Account
  9. Consignment Account
  10.  Joint ventures Account
  11. Revision
  12. Examination

LESSON NOTE FOR THE FIRST WEEK ENDING 15TH OF SEPTEMBER 2020

CLASS- SS3

DURATION– 40 MIP

NOS OF PERIOD- 4

TOPIC – Revision of SS2 work.

PREVIOUS KNOWLEDGE:- The student had been examined on the various topics taught in the SS2 scheme

BEHAVIOURAL OBJECTIVE:- The student should be able to:

Develop confidence in the study of Accounting as a subject. 

 Recall all topics taught in Ss2

INSTRUCTION MATERIAL:- Board

REFERENCE MATERIAL:- SS2 scheme content.

Revision of SS2 first term to Third term work.

Evaluation:

What are your views so far in the studying of Accounting as a subject.

Assignment:

An Economy cannot survive without an accountant discuss.

LESSON NOTE FOR THE SECOND WEEK ENDING 22ND SEPTEMBER2020.

SUBJECT- ACCOUNTING

CLASS- SS3

DURATION- 40 MIP

NO OF PERIOD- 4

TOPIC-Company income statement

Behavioral objectives- The student should be able to:

State the meaning of income statement

List and explain the basic contents of income statement of a company

State the treatment of the items in the company’s Final Account

Previous knowledge:- The students have been taught about the meaning, classification and Types of  company in the previous class.

Instructional material – News papers, Business Journals, marker and white board.

Reference material- Simplified and Amplified Book-keeping and Accounting for SS1-3 by O.A Longe & R.A Kazeem

Content:

Company income statement is the statement containing the financial account of a company. The statement of account of company is similar to that of a sole trader except for the appropriate account which has some peculiar feature.

PECULIAR FEATURE OF A COMPANY’S STATEMENT OF ACCOUNT

Directors remuneration and auditors fees. These should be deducted from the net profit before arriving at profit before tax.

Share capital.

Authorized share capital: this is the amount of cap[ital which a company has been authorized to raise in the memorandum ay association

Issued capital: This is the part of the authorized capital that has been issued to the public by the company for subscription

Called-up capital: this is the part of the issued share capital which the directors have called upon the share holder to pay

Taxation: this is the compulsory sum of money which the government or tax authority expected the company to pay out of the profit made.

Appropriation Account: This is the account where the profit after tax is shared (appropriated). Items found in t5his account include; transfer to reserve, interim dividend pond, proposed dividend, preliminary expense written off etc.

Reserves

Debentures

Dividend

Presentation;

Step i. Revision of the previous topic

Step ii Introduction of the new topic

Step iii Explanation of the new topic

Step iv General class discussion

Assignment:

What is a statement of account

List and explain five peculiar features of a company and explain all the terms used in it.

Conclusion:

The teacher summarizes the lesson and give the student note.

LESSON NOTE FOR THE THIRD WEEK ENDING 29-09-2020

CLASS                      –                       SS3

DURATION              –                       40 M/P

NO OF PERIOD       –                       4

TOPIC:                 –                  Company’s Appropriate Account

OBJECTIVES       –                  The students should be able to:

State the meaning of Appropriation account

Prepare the appropriation account of a company

Draw a format of a company trading profit and loss account and appropriation account.

PREVIOUS KNOWLEDGE – The students had been taught the introduction to company income statements in the previous lesson.

INSTRUCTIONAL MATERIALS – Business journals, white board and marker.

Reference Materials:  Simplified and Amplified financial accounting by Femi Lunge, Financial Accounting made easy by Igben Robert O.

CONTENT:-

FORMAT OF A COMPANY APPROPRIATION ACCOUNT

XYZ LIMITED

Appropriation account for the year ended 31st December 2007

  N N   N N
Dividend Proposed Interim Goodwill written off Preliminary expenses Written off Transfer to reserves Corporation tax Retained profit   X x     X X   X X X X xx Profit & loss b/f Net profit b/f X X               xx

ILLUSTRATIONS

Ikemesie Enterprises Limited has an authorized share capital of N200,000 divided into `60,000 ordinary share of N1. Each and 40,000 6% preference share of N1 each. 120,000 of the ordinary shares has been issued and fully paid. The profit after taxation for the year ended 31st December, 1919 was N49,000. The profit and loss account had a credit balance of N24,000 as at 1st January, 1999.

Additional information:

Write off preliminary expenses N1,700

Transfers N6,000 to general reserve and N4,000 to capital reserve.

Half of the dividend due on this preference shares had been paid in July.

An interim dividend of 5% had been paid on ordinary shares in September, 1991 and the directors proposed a final dividend of 10%. You are required to prepare the

Appropriation account

Solution

Appropriation account for the year ended 31/12/99

  N N   N N
Interim dividend Preference share Ordinary share Proposed dividend ord Preliminary expense written off Transfer to reserve General   Retain profit     2400 6,000     6000 4000 40900 73,000 Bal b/d Profit after tax                       73,000

Workings: Preference dividend 6% x 40,000 = N2400

Interim ½  x 2400 = N1,200: Find = N1200.

Presentation

Step i:           Teacher  revises the previous topic

Step ii:          Introduces the new topic

Step iii:       Explanation of the salient points

Step iv:       General class discussion

Evaluation:

List and explain the contents of the company’s appropriation account.

What are the differences between company appropriation account and the partnership appropriation account.

Assignment: Simplified and Amplified Book-keeping and accounting by Femi Lunge page 415 Ex. 3X and Ex 4.

Conclusion

The teacher summarizes the lesson and give students note on the topic.

LESSON NOTE FOR THE FOURTH WEEK ENDING 6TH OCTOBER 2020

CLASS                                              –           SS2

DURATION                                      –           40 M/P

NO OF PERIOD                              –           4

TOPIC                                               –           CONTROL ACCOUNT

SUB-TOPIC                                     –           SALES LEDGER CONTROL ACCOUNT

PREVIOUS KNOWLEDGE        –        The students had been taught errors and correction of errors in the previous lesson.

OBJECTIVES – The students are expected to:

Define control account

Identify the classification of control account

Explain the purpose of total debtors control accounts

Prepare the sales ledger control accounts.

INSTRUCTIONAL MATERIAL – White board and marker

REFERENCE MATERIAL – Simplified and Amplified Book keeping and Accounting for SSS1-3 by Femi Lounge. Essential  financial Accounting for SS 1-3 by R.A. Kazeem and O.A. Longe .

CONTENT

Control accounts can be defined as a memorandum account, the balance of which reflects the aggregate balances of the totals in related ledgers which are prepared following the double entry principles. It is used to monitor debt due from the debtors and debt due to the creditors.

Control account helps in error location

It provide check on the accuracy of balances of ledger

It prevent fraud

It help in ascertaining the balances of the debtors and creditors ledger

It is used to detect missing figure.

Classification

Total debtors control account

Total creditors control account

Sales ledger control account

This is the control accounts for saler ledger. It can also be referred to as total debtors control  account. It shows the total debt that from the debtors.

FORMAT

Dr               TOTAL DEBTORS CONTROL ACCOUNT                Cr

                                                                    N Dr Balance b/d                                        x Credit sales                                              x Debit note issued                                   x Int. charge on our due account           x Dishonoured cheque                              x Discount disallowed                               x                                                                                                                                               x Bal b/d                                                         x                                                              N Cr balance b/d                                       x Cash from debtors                                x Return inwards                                      x Bad debts                                                   x Discount allowed                                     x Credit  note issued                                  x Bills receivable                                         x Contra/set off                                            x Bal c/d                                                         x                                                                        x

Presentation

Step i:         Revision of previous topic

Step ii:        Introduction of new topic

Step iii:       Explanation of new topic

Step iv:       General class discussion

Evaluation

(i)        What is control account?

(ii)       Mention the division of control account

Assignment

Simplified and Amplified Book keeping and accounting page 280 Ex 1x

Conclusion – The teacher give students note.

LESSON NOTE FOR THE FIFTH WEEK ENDING 13TH OCTOBER 2020

CLASS                      –           SSS 3

DURATION              –           40 M/P

NO OF PERIOD      –           4

TOPIC                       –           COMPANY BALANCE SHEET

PREVIOUS KNOWLEDGE – The students have been taught about the balance sheet of a sole trader.

BEHAVIOURAL OBJECTIVE – The students are expected to:

(i)        Draw the format of a company balance (“T” format and vertical format)

(ii)       Differentiate between a sole trade balance sheet and the company                           balance sheet.

(iii)      State the meaning of the contents in the balance sheet

INSTRUCTIONAL MATERIAL – Business daily, white board and marker

REFERENCE MATERIAL – Essential financial accounting for SSS 1-3 by R.A. Kazeem and A.O. Longe , Simplified and Amplified Book keeping and Accounting for SSS – 3 by Femi Longe .

CONTENT

FORMAT

XY LTD

T. FORMAT

Balance sheet as at 31st December 19xy

             
Authorized share capital Ordinary share 10% preference share Issued share capital Ordinary share of N1.00 each 80% Prof. share of N1. Each   x x   x x   x x     x Land & building Furniture Machinery Premises Goodwill Investments Quoted Unquoted x x x x     x x – (xi (xi (xi x x x x x   x
             
 Reserves Share premium General reserves Retain profit Capital reserve Long term liabilities X % debenture X% Bank loan Current liabilities Bills payable Income in advance Corporation tax Creditors Proposed dividend Accruals  (expenses)   x x x x         x x x x x x               x x             xx xxx Preliminary expense   Current Assets Stock Debtors Cash in hand Bank Bills receivable Prepayments Accrued income             x x x x x x x x                         x                 xxx

                                                                                                                                                                                                                                                                                                                           Cost                                                                                                                                                                                    Acc.                                                                                                                                                                                                                                                                                                                         N.D.V

            Depr.

                                                N                                 N                                 N

Land and building              x                                                                     x

Furniture                              x                                  (xi                                x

Machinery                           x                                  (xi                                x

Premises                              x                                  (x)                               x

                                                                                                                        xx

Investments: Quoted                                           x                                 

                           Unquoted                                      x                                  x

Preliminary   expenses                                                                            x

Current Assets

Stock                                                                         x

Debtors                                                                    x

Cash at bank                                                           x

Prepayments                                                          x                      xx

Less current liabilities

Bills payable                                                           x

Corporation tax                                                     x

Proposed dividend                                                x

Creditors                                                                 x

Accruals                                                                  x                      (x)                               x

                                                                                                                                                                                                                                                                                                            Xxx

Financed by:                                                           N                                 N

Issued capital                                

Ordinary share                                                                                          x

X% preference share                                                                               x                      x

Reserves:                                                               

Share premium                                                                                          x

General reserves                                                                                      x

Retain profit                                                                                                x                      x

Long term liability

Debenture                                                                                                   x

X% bank loan                                                                                              x                      x

                                                                                                                                                                                                                                                                                                            Xx

Presentation:

Step i:         Revision of the last lesson

Step ii:        Introduction of the new topic

Step iii:       Explanation of salient points

Step iv:       General class discussion

Evaluation:

Define the following terms

Preliminary expenses

Interim dividend

Proposed dividend

Debenture

Unquoted investment

Quoted investment

Share premium

Retain profit

Assignment simplified and amplified Book keeping and accounting for SSS1-3 page 419 Exc 2.

Conclusion:  The teacher summarizes the lesson and give students note on the topic taught.

LESSON NOTE FOR THE SIXTH WEEK ENDING 20TH OCTOBER 2020

CLASS                  –        SS3

DURATION           –        40 M/P

NO OF PERIOD     –        4

TOPIC                  –        SECURITY AND EXCHANGE COMMISSION

OBJECTIVES       –        The students are expected to:

(i)        State the meaning of S.E.C

(ii)       State the functions and objectives of S.E.C.

PREVIOUS KNOWLEDGE – The students are familiar with the capital market.

INSTRUCTIONAL MATERIAL – charts

REFERENCE MATERIALS

CONTENTS:

THE SECURITY AND EXCHANGE COMMISSION S.E.C.

This is the apex regulatory organization of the Nigeria capital market. The S.E.C was established in 1979s.

FUNCTIONS

Valuation of shares

Registration of securities

Registration of market operators

Approve of shares allotment

Enforcement of sanction against erring operators

Approval of regulation of merger and acquisition

Approved time and amount of security

Determine the duration for which a company’s security will be sold

It serves as the apex regulatory organ of the capital market.

OBJECTIVES

To create a conclusive environment for fair dealing

To ensure orderliness and equitable dealing in security

To promote the investors

To protect the investors’

To monitor effectively the activities of unscrupulous capital market operators.

To maintain proper surveillance

Ensuring the integrity of the security business.

TOOLS OF REGULATION

Registration

Enforcement

Surveillance and monitoring

Inspections

Rule making

PRESENTATION:

Step i:                                                                 Revision  of the last topic taught

Step ii:                                                                     Introduction of the new topic

Step iii:                                                                     Explanation of salient points

Step iv:                                                                          General class discussion

Evaluation

What is the meaning of S.E.C?

List and explain at least five functions of the S.E.C.

Assignment

List and explain the objectives of the S.E.C

With detail explanation state the regulatory tools used in the capital market.

Conclusion

The teacher summarizes the lesson and give the students note on the topic.

LESSON NOTE FOR THE SEVENTH WEEK ENDING 27TH OF OCTOBER 2020

CLASS                  –        SS3

DURATION           –        40

NO OF PERIOD     –        4      

TOPIC                  –        The stock exchange market.

OBJECTIVES       –        The students should be able to:

Know the meaning of the stock exchange  market

State the functions and roles of the stock exchange market.

INSTRUCTIONAL MATERIALS – Charts, white board and marker

REFERENCE MATERIALS – Simplified and Amplified financial accounting by R.A. Ibrahim and R.A. Kazeem  for SS 123,

CONTENT:

The stock exchange market is a specialized market where existing security are traded. It is a market for buying and selling shares and other securities.  The Nigerian stock exchange was established in 1960. The at establishing it allows only registered brokers to engage in the business of trading in securities. It had branches in Lagos, Ibadan, Abuja, Kaduna, Portharcourt, Kano and Ilorin.

FUNCTION OF N.S.E.

Facilitates purchases and sales of securities

Provision of corporate information

Valuation of price of securities

Provision of information about daily transactions

Provision of rules and regulation

Provide professional advice

Ensuring the liquidity of securities

Help the government  to raise fund.

Enables the companies to raise fund

Ensure the stability of the capital market

Provide  market for investors

Increases the volume of security through bonus issue, right issue etc.

Presentation:

Step i:         Revision of the previous lesson

Step ii:        Introduction of new topic

Step iii:       Explanation of salient points

Step iv:       General class discussion

Evaluation

Define the stock exchange market

What are the functions of the stock exchange market?

Assignment

To what extent has the stock exchange market contributes to the development of Nigeria capital market?

Conclusion

The teacher summarizes the lesson and give the students note

LESSON NOTE FOR THE EIGHT WEEK ENDING 03-11-2020

CLASS                  –                  SS3

DURATION           –                  40 M/P

NO OF PERIOD     –                  4

TOPIC                  –                  THE STOCK EXCHANGE MARKET.

PREVIOUS KNOWLEDGE – The students had been introduced to the capital market and the control security clearing system in the previous lesson.

OBJECTIVES: The students are expected to:

(i)        Know the meaning of the stock exchange market

(ii)       State the functions and roles of the stock exchange market.   

INSTRUCTIONAL MATERIAL – White  board and marker

REFERENCE MATERIAL – Simplified and Amplified financial accounting by Femi Longe .

CONTENT:

The stock exchange market is a specialized market where existing security are traded. It is a market for buying and selling of shares and other securities. The Nigerian stock exchange market was established in 1960. The act establishing it allows only registered brokers to engage in the business of trading in securities. It has branches in Lagos, Ibadan, Abuja, Kaduna, Portharcourt, Kano and Ilorin.

FUNCTIONS OF N.S.E

Facilitates the purchase and sales of securities.

Provision of corporate information

Valuation of price of securities

Provision of information about daily transactions

Provision of rules and regulation

Provides professional advice

Ensuring the liquidity of securities

Help the government to raise fund

Enables the government to raise fund

Ensures the stability of the capital market

Provides market for investors

Increases the volume of securities through bonus issue, right issue etc

Presentation:

Step i:         Revises the last lesson

Step ii:        Introduces the new topic

Step iii:       Give details explanation of some salient points

Step iv:       General class discussion

Evaluation

Define the stock exchange market

What are the functions of the stock exchange market

Assignment:

To what extent has the stock exchange market contributes meaningfully to the development of Nigeria capital market.

Conclusion

The teacher summarizes the lesson and gives students note on the topic

LESSON NOTE FOR THE NINETH WEEK ENDING 10-11-2020

CLASS                  –                  SS3

DURATION           –                  40 M/P

NO OF PERIOD     –                  4

TOPIC                  –                  HIRE PURCHASE ACCOUNT

PREVIOUS KNOWLEDGE- The students are used to buying goods on credit and instalmental payment.

BEHAVIOURIAL OBJECTIVE – The students are expected to:

Define Hire purchase account

State and explain the parties involves in Hire purchase

State and explain the terms used in Hire purchase contract.

Prepare  a single Hire Purchase Contract Account

INSTRUCTIONAL MATERIAL – White Board and Marker

REFERENCE MATERIAL – Accounting for special Business by Dare Adekunle, Simplified and Amplified Book keeping and accounting by Femi Longe .

CONTENT:-

A Hire purchase transaction is one in which the seller if an item parts with the possession and transfer same to a buyer who, in return pays to the seller an amount known as hire purchase price by a way of an initial deposit plus periodic installments over the hire period. The buyer does not possess the title to the goods until the full hire purchase price is settled common Hire Purchase TERMS.

Hire purchase price

Cash Deposit/initial deposit

Installment

Hire purchase interest

PARTIES TO HIRE PURCHASE CONTRACT

Hirer  or Buyer

Hirer or Dealer/seller

Finance Company

ACCOUNTING ENTRIES

In preparing Hire Purchase Account in the book of the buyer, the following are the principal methods:

Interest paid method

Interest suspend method

INTEREST PAID METHOD –  This is the commonest and simplest  method of accounting for Hire Purchase under this method, the full cash price is debited to the Asset account and credited to the vendor’s account; interest is treated as being paid and credited to vendor’s account and all cash payment being debited.

PROCEDURES:

Assets Acquire on Hire purchase

                                                                                                         Dr Hire purchase account                                                                                                                                                   Cash price

                                                                                                                       Cr Vendor account

Payment of initial deposit

Dr Vendor account

Cr Cash/Bank account

Interest due at date of installment

Dr Hire purchase interest account

Cr Vendor account

Installment cash payment made

Dr Vendor account

Cr Bank/cash account

Interest  written off to profit & loss

Dr Profit and loss account

Cr Hire purchase interest account

Depreciation: on Asset

Dr Profit and loss account

Cr Provision for depreciation account

ILLUSTRATION

R. Dickson whose accounting year ends on 31st December bought a machine on Hire purchase from Ise – Ekiti Ltd on 1 January 2010. The cash price of the machine was N83,800. Interest to the calculated at 15% on the half yearly balance outstanding. There would be 5 annual installments each payable on 30th June. The first four installments to be N25,000 each while the balance to be settled in the fifth year of the account installments commence on 30th June  2010. Depreciation on the machine was provided at 10% on cost per annum.

You are required to show the following account.

i.          machine account

ii.         Ise – Ekite Ltd account

iii.        Hire purchase interest account

iv.        Depreciation of machine account

v.         How the transaction would appear in the balance sheet as at 31/12/2012

Solution

Machine account

        1.1.2010 Ise – Ekit 1.1.2010 Bal b/d   `N 83,800 83,800   31.12.00 bal c/d   83,800

ISE-EKITI FINANCE LTD ACCOUNT

                                                          N 30-06 instalment                   25,000 31-12- Bal c/d                       69,966                                                     94,966 30-6- instalment                  25,000 31-12. Bal c/d                      53,979                                                   78979                                                      60504                                          N 1-1-10 machine                               83,800 30-06 interest                                  6285 31-12 interest                                  4881                                                           94960 1-1-11 Bal b/d                                 69,966 30-6 interest                                   52,979 31-12. interest                                3766                                                           78979 1-1-12 Bal b/d                                 53979 30-06 interest                                 4048 31-12 Interest                                2477                                                          60504

H.P INTEREST ACCOUNT

                                                          N 30-06 Ise -Ekiti                       6205 31-12 Ise – Ekiti                     4881                                                   11,161 30-6 Ise – Ekiti                      5247 31-12 Ise-Ekiti                      3766                                                 9013 30-6-12  Ise – Ekiti            4048 31-12. Ise-Ekiti                    2477                                                                                                                                                                                                                                             6525                                          N 31-12-10     P & L                              11,166                                                               11,166 31-12-12  P & L                                  9013                                                                  9013 31-12 -12 P & L                                   6525                                                                    6525

PROVISION  FOR DEPRECIATION ACCOUNT

                                                          N 31-12 Bal c/d                          8380 31-12 Bal c/d                          16760                                                     16760 31-12-12 Bal c/d                  25140                                                                                                                                                                                                                                             25140                                          N 31-12-10     P & L                              8380 1-1-11 Bal b/d                                    8380 31-12-11 P & L                                 8380                                                            16.760 1-1-12 Bal c/d                                  16760 31-12 P & L                                       8380                                                             25140                                                     

BALANCE SHEET EXTRACT FIXED ASSETS:

Machine on Hire purchase                                                                                 83800

Less Depreciation on Hire Purchase                                                             25,140         

Calculation of Hire purchase Interest

N

Cash price                                                                                                   83,800

Interest (Jan. – June) 6/12 x 15% x 83800                                            6255

                                                                                                                        90085

Less 1st Installment                                                                                   25,000

                                                                                                                        65085

Interest (July-Dec) 6/12 x 15% x 65085                                                 4881

                                                                                                                        69966

Interest (Jan – June) 6/12 x 15% x 69966                                             5247

                                                                                                                        75213

Less 2nd installment                                                                                  25,000

                                                                                                                        50213

Interest (July-Dec) 6/12 x 15% x 50213                                                 3761

                                                                                                                        53979

Interest (Jan-June) 6/12 x 15% x 53579                                                4048

                                                                                                                        58027

Less 3rd installment                                                                                   25,000

                                                                                                                        33,027

Interest (July – Dec) 6/12 x 15% x 33,027                                             2477

                                                                                                                        35504

Interest (Jan – June) 6/12 x 15% x 35504                                             2663

                                                                                                                        38167

Less 4th installment                                                                                   25,000

                                                                                                                        13,167

Presentation:

Step i:         Revision of the previous topic

Step ii:        Introduction of the new topic

Step iii:       Explanation of salient points

Step iv:       General class discussion

Evaluation

What is Hire purchase account

State and explain the “Term and parties” used and involve in Hire Purchase account respectively.

Assignment

Simplified and Amplified Book keeping and accounting by Femi Longe  Page 484 Ex 1 x and 3.

Conclusion

The teacher summarizes the lesson and give students note on the topic.

Lesson Note For The Tenth Week Ending 2020-11-2020

CLASS                                              –                  SSS3

DURATION                                        –                  40 M/P

NO OF PERIOD                                  –                  4

TOPIC                                               –                  Consignment Account

BEHAVIOURIAL OBJECTIVES          –                  The students are expected to:

Know the meaning of consignment

State and give the meaning of terms used in a consignment account.

Differentiate between the consignment and sales of goods.

Prepare a consignment account in the book of the consignor and in the book of the consignee

INSTRUCTIONAL MATERIAL – White board and marker

REFERENCE MATERIAL – Financial Accounting made simple by Robert O. Igben:, simplified and Amplified financial Accounting by Femi Longe .

CONTENT:

A consignment of goods is the sending of goods by the owner to his agent who then collects, stores and sells them on behalf of the owner. The owner is known as the consignor while the agent is known as the consignee. The relationship between the consignor and the consignee is a principal agent relationship.

Account sales:

As stated above, the consignee is an agent, it is necessary for him to send returns to the consignor on a regular basis. The returns are sent on a document known as “Account Sales” showing the sales of the consignee, the expenses of the consignee and the balance due to the consignor. If the consignor had collected deposit from the consignor at the onset of the transactions the deposit will be deducted on the account sales before arriving at the balance due to the consignor. Shown below is the format of an account sales.

                                                                                                N                                             N

Sales                                                                                                                                     x

Less expenses                              

Storage charges                                                               x

Selling & distributive exp.                                               X

Consignee’s commission                                               x                                              (x)

Balance due to consignor                                                                                              xx

Date……………………………..…..                                  Signal…………………………………

ILLUSTRATION

The learning field Ltd U.S.A consigned goods to the value of N10,000 to their agent Corona of Nigeria. He paid freight N20, Insurance N200, shipping charges N200 and drew a bill on Corona at 90 days for N7,500. This bill, learning field Ltd discounted with their bankers, the charge therefore being N100. In the course, Corona renders account sales showing the amount for which the goods were disposed off as being N12500. He deducts his commission which is 7 ½ % and expenses on landing N50, warehouse rent N50, and remits a draft on union Bank for the balance. Show the necessary ledger accounts in the books,  of the consignor and consignee.

Solution

Consignors Book: Learning field Ltds

Dr                               Consignment account                                                     Cr

Goods on consignment                       10,000 Freight                                                   20 Insurance                                              200 Shipping charge                                   200 Commission                                            938 Loading expenses                                 50    Warehouse rent                                    50 Profit & loss                                               1042                                                                     12500                                                        Sales                                                    12500                                                                          12500                                                                                                          

Goods on Consignment A/c

Trading                                                10,000 Consignment A/c                                10,000

CASH BOOK

Bill Receivable                   7500              Discount  charges                                    100

Consignee                           3962              Consignment Act

                                                                        Freight                                                          20

                                                                        Insurance                                                    200

                                                                        Shipping charges                                     200

                                                                        Bal c/d                                                           10942

                                                11,462                                                                                  11,462

Consignee Account

Consignment  sales                          12500                                                                      12500 Bill receivable                                     7500 Loading expenses                                   50 Warehouse rent                                        50 Bank                                                           3962                                                                    12500

Bill Receivable  Account

Odegbemi                7500                          Cash  book                                      7500

In the book of the consignee Odegbemi

Cash book

   sales                                                    1250                                                                        12500                                                                      N Bill payable                                             7500 Commission                                            938 Warehouse rent                                       50 Landing expenses                                   50 Consigner                                               9362                                                                   12500

Consignor account: Fizi Ltd

                                                                    N  Commission                                            938 Landing expenses                                   50 Warehouse expenses                             50 Bills payable                                           7500 Cash                                                          3962                                                                 12500                                                                      N Sales                                                       12500                                                                       12500

Bills payable

                                                                    N  Cash book                                             7500                                                                        N Consignor                                                   7500                                                   

Presentation:

Step 1:                 Revision of the previous topic

Step 2:                 Introduction of the new topic

Step 3:                 Explanation of salient point

Step 4:                 General class discussion

Evaluation

What is consignment Account?

List and explain the basic  terminology used in consignment account

What is account sales?

Assignment

Simplified and Amplified Book keeping and Accounting   for SSS1-3 Ex 4 and 9x

Conclusion:  The teacher summarizes the lesson and gives the student note on the topic.

CLASS                           –        SS3

DURATION                    –        40 M/P

NO OF PERIOD               –        4

TOPIC                            –        JOINT VENTURE ACCOUNT

BEHAVIOURIAL OBJECTIVE – The students are expected to:

Define or state the meaning of joint venture account.

State the differences between Joint venture and partnership account

Prepare a joint venture account

PREVIOUS KNOWLEDGE – The students are familiar with partnership and consignment account.

INSTRUCTIONAL MATERIAL – White board and marker

REFERENCE MATERIALS – Essential financial accounting for SS 1 – 3  by O.A.  Longe et al, Simplified and Amplified Book keeping and Accounting by Femi Longe.

CONTENT:

 A joint venture is simply a venture undertaken by two or more persons with a view to gaining profit. It differs from a partnership in that it is of a more temporary character.

Nowadays, Joint ventures are offer concerned with one isolated transaction. Such as buying up  bankrupt stocks  or engaging in similar operations

MAIN CHARACTERISTICS

NO spate books are kept to record the transactions by ventures 

Each venture keeps a record of his part of the enterprise in his normal accounting records.

The profit sharing ratio must be clearly defined.

Every entitlement of the venture must be clearly stated.

ILLUSTRATION:

A and B entered into a joint venture to acquire surplus and reject crockery from the manufacturer to sell them at a series of one day market. They agreed to share joint venture profit and loss in ratio 3-2  respectively.

At the onset A sent a cheque for N2000 to provide him with fund for B his participation in the venture. They managed to sell all the goods bought by 31st January 2014 by which date their cash transactions had been.

                                                                                                                                                                                                                                                            A                                 B

Sales                                                                                     3200                          2100

Travelling expenses                                                         327                             463

Advertising                                                                          103                             91

Stall rent                                                                              85                               70

Wages of causal ledger                                                   48                               –

Sunday expenses                                                              59                               29

Purchases                                                                           1600                          1100

Settlement between the co-ventures required:

Joint venture with B in the ledger of A

Joint venture with A in the ledger of B

Memorandum Joint venture account

Solution

In the book of A joint venture with B Account

Bank (transfer to B) Bank travelling expenses Advertising Stall rent Wages Sunday expenses Purchases Profit & loss 2000 32020 103 85 48 59 1600 795 502020 Sales Bank 3200 202020            
502020

In the ledger of B

Joint venture with A Account

Travelling expenses Advertising Stall rent Sundry expenses Purchases Profit & loss Bank 463 91 70 29 1100 530 202020 4100   Bank Sales   2000 2100        
4100

MEMORANDUM JOINT VENTURE

 Travelling (327+ 467) Advert (103 + 91) Stall rent (85 + 70) Wages Sunday (59 + 29) Purchases (1600 + 1,100) Share of profit A                            B 790 194 155 48 88 2700 798 530   5300 Sales (7200 + 2100) 5300                
5300

NB – Share of profit                       B

A         =          3/5 x 1325                  B = 2/5 x 1325

                                    = N795                         = N530

Presentation:

Step 1:        Revision of last topic

Step 2:        Introduction of the new topic

Step 3:        Explanation of salient points

Step 4:        General class discussion.

Evaluation

What is joint venture account?

Write out the basic differences between a joint venture and a partnership account.

Assignment

Simplified and Amplified Book keeping and Accounting page 278/279 Ex 4x and 7x.

Conclusion

The teacher summarizes the lesson and gives students note on the topic

Lessonplan

Get Lesson plans, Lesson notes, Scheme of work, Exam Questions, Test Questions for all subject for Primary school and Secondary School.

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