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
- Contract Account
- Interpretation of financial statement
- Departmental account
- Branch account
- Public sector accounting
- Personal budget
- 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.