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

Second Term Scheme of Work Account for SSS 3

  1. Contract Account
  2. Interpretation of financial statement
  3. Departmental account
  4. Branch account
  5. Public sector accounting
  6. Personal budget
  7. Past examination questions

LESSON NOTE FOR THE FIRST WEEK ENDING 12-01-2020

CLASS                  –         SS3

DURATION           –        40 M/P

NO OF PERIOD     –        4

TOPIC                  –        CONTRACT ACCOUNT

BEHAVIOURIAL OBJECTIVES – The students are expected to:

State the meaning of contract and types of contract

Define the basic terms  associated with contract account

Prepare a simple contract account

PREVIOUS KNOWLEDGE –  The students  are familiar with the construction of roads and building of houses.

INSTRUCTIONAL MATERIALS –  White board and marker

REFERENCE MATERIALS –  Essential financial accounting for SSS 1-3 by O.A Longe et al and simplified and Amplified financial Accounting by Femi Longe.

CONTENT:  Period 1-2

Accounting  to SAS 5” construction contract involves the execution  of works that are civil and electrical engineering in nature construction contract is the application of job costing to relatively large cost units, particularly unit that take a considerable  length of time  to complete and are constructed away from the enterprises.

Premises – It is a form of trading account for each contract. Period 3 & 4

NATURE/TYPES OF CONTRACT

Short term contract

Long term contract

Characteristics of contract

The direct cost is large

It is done outside the company premises (site based)

It is long term in nature

There is low indirect cost

It is done according to customers specification or requirement

Terminologies

Revenue Recognition

Contract work in progress

Mobilization fees

Contract certification

Retention money

Accounting entries

Open an account for the contract

Dr: All contracts’ direct cost

Cr: Material, plant or other items transferred from the contract

Dr: head office overheads charge to the contract

Cr:  Contract price.

Transfer balance profit or loss to the profit and loss account.

Method of Accounting for contract.

Completed contract method

Percentage of completion method

Dr          Format                                                                                             Cr

Material issued                                        x Wages paid                                               x Wages accrued                                       x Sub-contract charges                          x Plant purchased at cost                      x Overheads                                               x Plant transfer to site                            x H/o overheads                                       x Direct expenses                                    x Material from site                                  x Establishment cash                             x Cost of                                                      x                                                                           x Cost of work certified                          x National cost                                          x Profit & Loss                                           x                                                                     xx Material returned                                    x Plant & material transfer   from site  x Material in site c/d                                   x Cost of work certified                             x Cost of work not certified                     x                                                                                     x                                                                             xx

Work in progress:

Cost incurred to date                                                                                                       x

Add profit recognized                                                                                                      x

                                                                                                                                                xx

Less foreseeable losses                                                                                                (xi)

                                                                                                                                                Xx

Less progress payment received                                                                                (x)

                                                                                                W.I.P                                      xx

Presentation:

Step i:         Introduction of the topic                                                                        

Step ii:        Explanation of terms

Step iii:       Illustration of the topic

Step iv:       General class discussion

Evaluation

What is the difference between contract and other form of business dealings.

Explain how a contract may be costed.

Assignment

Simplified and Amplified page 571 Ex 1

Conclusion

The teacher gives note on the topic after summarizing the lesson to the students.

LESSON NOTE F OR THE SECOND WEEK ENDING 19-01-2020

CLASS                           –                  SS3

DURATION                    –                  40 M/P

NO OF PERIOD               –                  4

TOPIC                            –                  Financial Ratio

SUB-TOPIC                    –                  Interpretation of financial Ratio

OBJECTIVES                 –                  The students are expected to:

State the meaning of financial Ratio

List and explain the various financial ratios

Interpret the result of each ratio.

State the implication of the ratios on company’s balance sheet and financial statement.

PREVIOUS KNOWLEDGE –  The students are familiar with the preparation of the final account.

INSTRUCTIONAL MATERIAL – White board and marker.

REFERENCE MATERIAL – Financial Accounting made simple by Robert O. Igben and Simplified and Amplified Book keeping and Accounting for SS1 – 3 by Femi Longe.

CONTENT

An accounting ratio is a proportion or fraction or percentage expressing the relationship between one item in a set of financial statements and another item in the same financial statements.

TYPES OF ACCOUNTING RATIO

Profitability ratio

Liquidity ratio

Investment ratio

PROFITABILITY RATIO – The profitability ratio measures the profit earned over the period and capital employed at the end of the year. It reveals the effectiveness and efficiency of the management.

Gross Profit percentage:

                                                                                                                                        x                                                                                                                                                 100%                                                                                                                                                                                                                                                                                                                   (margin)

                                                                                                                                          x                                                                                                                                                 100%                                                                                                                                                                       

(Net profit percentage)                                                                                                              

Return on capital employed

                                                                                                                                 x                                                                                                                                                 100%                                                                                                                                                                                   

Turnover ratio (Asset turnover ratio)

                                                                                                                                 x                                                                                                                                                 100%                                                                                                                                                                                   

(2)       LIQUIDATION RATIO:

This ratio measures the extent to which the business can meet its short term obligation or pay its debt as at when due.

Current ratio

Liquid ratio/acid test ratio

Rate of stock Turn over

Average stock = ½ (opening stock + closing)

Stock on current Asset

                                                                                                                                      x                                                                                                                                                 100%           

Debtors ratio

                                                                                                                                         x            365 days

Creditors ratio

                                                                                                                                         x            365 days

(3)       INVESTMENT RATIO

The investment ratio is sued by the investors in evaluating the share of quoted companies as a potential investment.

Price Earnings ratio

                                                                                                                                       x.e 

Dividend yield

Dividend cover

      or

Presentation:

Step 1:          Teacher revises the previous topic

Step 2:        Introduction of the new topic

Step 3:        Explanation of Salient points

Step 4:        General class discussion

Evaluation

List and explain the financial ratio applicable to:

The trading profit and loss account

Balance sheet only

State the implication(s) of each ratio on final account.

Assignment

Simplified and Amplified Book keeping and Accounting page 497/498 EX 5X  and 6X.

Conclusion

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

LESSON NOTE FOR THE 3RD WEEK ENDING 26-01-2020

CLASS                                                                                                         – SS3

DURATION                                                                                                                     –                                                                                                                  40 M/P

NUMBER OF PERIOD – 4

TOPIC – Department Account

OBJECTIVES –  The students should be able to:

State the meaning of departmental account

State the reason/purpose of departmental account

State the basic bases of apportioning common expenses between among the departments.

PREVIOUS KNOWLEDGE –  The students are familiar with the final account.

INSTRUCTIONAL MATERIAL –  white board and marker

REFERENCE MATERIALS –  Essential financial Accounting for SSS1 – 3 by O.A. Longe  et al: Simplified and Amplified book keeping and Accounting for SS1-3 by Femi Longe.

CONTENT

Department Account is an account prepared by a business organization which generates  income from different department in order to:

Compare the result of different department

Ascertain  the contribution of each  department  to the over all profit or loss

Reward or reprimand departmental managers

Know the department  that requires more attention

BASES OF APPORTIONMENT

SALES:  Selling expenses, discount allowed, bad debt, sales commission, advertising carriage outward.

PURCHASES:- Discount received, commission received etc.

AREA OCCUPIED:  Heating, lighting, rent and rates.

Number of employees:- Salaries, medicals, expenses, and welfare

Rate of consumption:  Electricity and power

Equal bases – Where there is no specific base of apportionment.

Format

  A B TOTAL        
Opening  stock Add purchase   Less closing stock         Gross profit  
Electricity Rent & rate Insurance Advertising Discount allowed Bad debt Depreciation Carriage outward Net profit.
x x x (x) x x xx x x x x x x x x x x x x x (x) x x xx x x x x x x x x x x x x x (x) x x xx x x x x x x x x x x Sales            
Gross profit b/d Discount received
X           xx x x               x X           xx x x               x X           xx x x               x

PRESENTATION:

Step i:                                                            The teacher revises the last lesson

Step ii:                                                                      He introduces the new topic

Step iii:                                             Explain the format of Departmental account

Step iv:                                                                          General class discussion

Evaluation

State the differences between the trading and profit and loss account of a sole trader and that of a departmental organization.

What are the major reasons for preparing departmental account?

Assignment

Simplified and amplified page 422.

EXC                                                                                                                                                4x

Conclusion

The teacher summarizes the lesson and gives the students note on the subject matter.

LESSON NOTE FOR THE FOURTH WEEK ENDING 02-02-2020

CLASS                           –         SS3

DURATION                     –        40 M/P

NUMBER OF PERIOD     –        4

TOPIC                            –         BRANCH ACCOUNT

OBJECTIVES                 –        The students are expected to:

Explain the concept “Branch Account”

Differentiate between a  branch and a head office.

List the pricing method involved.

State the division of branch account

Prepare a simple branch account

PREVIOUS KNOWLEDGE –  The students are familiar with organizations having different branches:

INSTRUCTIONAL MATERIAL – white board and markers.

REFERENCE MATERIAL –   Simplified and Amplified Book keeping and Accounting for SS 1 – 3 by Femi Longe: financial Accounting made easy by Robert O. Igben.

CONTENT

A branch can be defined as a small part of the business operating with some degree of independence.

Branch Account takes into consideration the entries of transactions in the book of an organization with different branches.

DIVISION OF BRANCH ACCOUNTING

Where the H/o keeps the books

Where the Branches keep separate books.

PRICING METHOD

Cost price

Cost plus percentage

Selling price

ACCOUNTING ENTRIES

Double column method/memorandum column method

Branch adjustment method

ACCOUNTING BOOKS (MEMORANDUM METHOD)

Branch stock accounts with double column

Goods sent to branch account.

Profit and loss Account

FORMAT:

Memorandum Branch Account

  Invoice price Letters price   I.P C.P
Stock at start Goods sent to branch Gross profit x x               X x x x             x Return to H/o Credit sales Cash sales Allowance off selling price Goods stolen Cash stolen Expenses paid out Normal loss Stock at close x x x x x x x x x x x x x – x x x x – x
Goods sent to branch Account
Return to branch                             x Branch stock                                         x
H/o trading Account                       x                                                              Xx  
                                                              Xx
Profit and Loss Account 
Branch stock                                     x Sundry expenses                              x Goods stolen                                      x Cash stolen                                        x Net profit                                            x Gross profit                                           x

                                                               x                                                                            xx

BRANCH ADJUSTMENT METHOD (BOOKS)

Branch stock at involve price

Branch Adjustment (Branch mark up account) at profit loaded.

Goods sent to branch account at cost.

Debtors account

FORMAT

 
Stock at start                                          x Goods sent to branch                          x                                                                                      xx Good  transfer to other branch           x Cash sales          x
credit sales                                               x Expenses paid out                                  x Reduction in S.P.                                    x Goods on transit                                     x Return to Head Quarter                       x Cash stolen                                             x Normal loss                                             x Cash in      hand                                      x Stock at close                                         x                                                                   xx

Goods sent to branch account (cost price)

Rtn to H/o                                                                 x          Branch stock                      x

Transfer to other branch                                    x         

H/o trading                                                              x

                                                                                    X                                                          xx

Branch stock adjustment/Branch mark up 

profit on Rtn to H/o                                                x          profit on opening stop      x

Profit on goods Rtn by custom                          x          profit on goods sent         x

Profit on goods transit                                         x          to branch                             x

Normal loss (selling price)                                 x         

Profits on goods stolen                                       x

Reduction in selling price                                   x

Profit on stock at close                                       x

Gross profit to P & L                                             x

                                                                                    X                                                          xx

Profit and loss Account .

Cost of goods stolen        x                      Branch  stock adj.                         x

Sunday expenses              x                      gross profit                                      x

Cost of goods lost             x

Cash stolen                         x

Net profit                              x

                                                Xx                                                                                xx

Presentation:

Step 1:        Introduction of the new topic

Step 2:        Review of the previous lesson

Step 3:        Explanation of the new topic

Step 4:        General class discussion

Evaluation

What is branch Account?

List and explain the two method of preparing of branch account.

Assignment:

Simplified and Amplified page 483 Ex 2

Conclusion

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

LESSON NOTE FOR THE FIFTH WEEK ENDING 09-02-2020

CLASS                           –                  SS3

DURATIONS                  –                  40 M/P

NO OF PERIOD               –                  4

TOPIC                            –                  PUBLIC SECTOR ACCOUNTING

OBJECTIVES – The students are expected to:
1.        Define government  sectors accounting 

2.        State the importance of Government accounting

3.        Differentiate between government accounting and private sector      accounting

4.        Prepare an accounting for the local, state or federal government 

INSTRUCTIONAL MATERIALS – White board & marker

REFERENCE MATERIAL – Simplified and Amplified financial accounting for SSS1 – 3 by Femi Longe: Essential financial accounting by O.A. Longe et al.

CONTENT

Public sector accounting can be defined as the process of recording analyzing and interpreting the financial transactions of the government.

PURPOSE

It serves as a base of government planning

To depict the source of government revenue

To give evidence of financial accounting

To s how the basis of disbursement of government revenue.

It serves as a control instrument and decision making.

DIFFERENCES BETWEEN GOVERNMENT AND PRIVATE SECTOR ACCOUNTING

Government                                                Private

Severe oriented                                                                                                                                                                                                                                                                         profit oriented 

Case bases                                                                                                                                                                                                                                                                                                                                                                                                                                              Accrual bases

Source of revenue (tax)                                                                                                                                                                                                                         Source of revenue (sales)

Asset are written off                                                                                                                                                                                                  Assets are spread over the life of Assets

one year

Sources of Revenue to Federal Government

Direct and indirect tax

Mining                                                                                                                                                           (c)                                                                                                                         Fees and licenses

(d)       Investment and dividend in corporation

(e)       Revenue from armed forces equipment etc.

STATE

(a)       Statutory Allocation         (b)       Investment

(c)       Rent on government properties

(d)       Special grants        (e) personal income tax   (f) licenses

LOCAL

(a)       Statutory Allocation         (b) Special grants (c) fines (d) Tenament rate (e) license etc

BASES OF ALLOCATION

Derivation                                                                                                                    ii. Equality                                                                                                                                             iii. Population            iv. Independent Revenue

No warrant is the instrument issued by the minister who authorized an officer to incure expenditure  voucher. This is the document showing  evidence of receipt or payment of money.

Presentation:

Step 1:        The teacher revises the previous topic

Step 2:        Introduction to the new topic

Step 3:        Explanation of salient point

Step 4:        General class discussion

Evaluation

Differentiate between a public sector accounting and a private sector accounting.

Assignment

Write short note on the following

(i) vote (ii) warrant (iii) voucher

Amplified and Simplified   page 584/585 EXC 9.

LESSON NOTE FOR THE SIXTH WEEK ENDING 16-02-2020

CLASS                            –                  SS3

DURATION                    –                  40 M/P

NO OF PERIOD               –                  4

TOPIC                            –                    PERSONAL BUDGET

OBJECTIVES                 –                  The students should be able to:

State the meaning of budget

State the classification of budget

Prepare a personal budget of an individual and a parastatals

PREVIOUS KNOWLEDGE – The students are familiar with the preparation of budget.

INSTRUCTIONAL MATERIAL – White Board & Marker

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

CONTENT

The following information was given in respect to Mr. Ajetumobi a level 15 officer:

Salary per annum N2020,000

Housing  allowance 30% of basic

Transport allowance N250 per month

Car loan repayment of N215 per month

Tax  at  the rate at 15% of basic  pay

Water rate at 1% of basic.

Repayment of advance of N15 per month.

You are required to prepare

The monthly budget of Mr. Ajetumobi

Journalize your entries

SOLUTION

Housing  30% x N1,500    =          N420

Tax rate 15% x N1,500     =          N225

Water rate 1% x N1500    =          N150

                                                                                                                                    N

Basic Salary                                                                                     1500

Less: Tax                                          225

            Water rate                           150

            Car loan                                215

Repayment of Advance                 15                                                                 700

Take home pay                                                                                                       N1,595

Journal

  Dr Cr
Basic Housing allowance Transport allowance Tax rate Water rate Car loan Repayment cash 1500 400 250       225 150 215 15 1,595
  2,200 2,200

Presentation:

Step 1:        The teacher introduces the lesson

Step 2:        He reviews the previous lesson

Step 3:        Explanation of cogent points

Step 4:        General class discussion

Evaluation

Simplified and Amplified financial Accounting page 507 EX IX and 2X.

Assignment: Simplified and Amplified page 508/509 EX 8.

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

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