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BREAKDOWN OF CA FOUNDATION ACCOUNTING CHAPTER WISE ANALYSIS

  • 14 Sep 2022

Accounting is a scoring subject. However, only reading or mugging it will not help. Practicing as many problems as possible is a mandate in order to clear CA Foundation exams. It is advised to solve a few problems daily. If you are from the non-commerce background, study the theory thoroughly and be clear in your concepts. Pay special attention to basic concepts like debit and credit, journal, cash book, etc.

The best part is that it conducts for the full 100 marks. You can score high on this subject and make this subject as much strength as you will not have to bother with your aggregate percentage. You can practice this subject on a daily basis. And if you are a commerce student then its practice on daily basis will also help you to get a good score in 12th standard also.

  1. Theoretical Framework 5%-10%
  • Meaning and Scope of Accounting: This chapter helps to understand the meaning and significance of accounting. It explains sub-fields of accounting, relationship of accounting with other subjects and the limitations of accounting.
  • Accounting Concepts, Principles and Conventions: This chapter introduces the concepts of entity, periodicity, matching, cost, dual aspect, materiality, money measurement, accrual, going concern, realization, conservatism and fundamental accounting assumptions of going concern, consistency and accrual.
  • Accounting Terminology – Glossary: The basic accounting terms are defined in this chapter.
  • Capital and Revenue Expenditures and Receipts: In this chapter, the criteria for identifying capital and revenue expenditure are explained along with its distinction. 
  • Contingent Assets and Contingent Liabilities: The meaning of Contingent Assets Contingent Liabilities and Provisions along with its distinction is explained in this chapter.
  • Accounting Policies: Meaning of different accounting Policies is explained.
  • Accounting as a Measurement Discipline – Valuation Principles, Accounting Estimates: Meaning of measurement and its basic elements like historical cost, realizable value and present value, difference between measurement and valuation is covered in this chapter.
  • Accounting Standards: Significance, Objectives, Benefits and Limitations of Accounting Standards explained in this chapter.
  • Indian Accounting Standards: Significance and need of issuance of Indian Accounting Standards is covered in this chapter.
  1. Accounting Process 25%-30%
  • Basic Accounting Procedures – Journal Entries: Meaning and Significance of double entry system, Types of Accounts, Determination of Debits and Credits and Recording Journal Entries is covered in this chapter.
  • Ledgers: Concept of Ledgers and technique of ledger posting is covered in this chapter.
  • Trial Balance: Preparation of Trial Balance and its importance is discussed in the chapter.
  • Subsidiary Books: Techniques of recording transactions in Purchase Book, Sales Book, Returns Inward Book and Returns Outward Book; Bills Receivable and Bills Payable Book are covered in this chapter.
  • Cash Book: Kinds of Cash Book, preparing three column cash book, Concept of Petty Cash Book is covered in this chapter.
  • Rectification of Errors: Types of errors, one sided and two-sided errors, concept of suspense book is covered in this chapter.
  1. Bank Reconciliation Statement: Preparation of Bank Reconciliation Statement, difference between pass book and cash book is explained in this chapter.
  2. Inventories: Meaning and Methods of Inventory Valuation like FIFO, LIFO, Specific Identification Method, weighted average Method, Adjusted Selling Price Methods are covered in the chapter.
  3. Concept and Accounting of Depreciation: Meaning and nature of depreciation, Methods of depreciation, its advantages and disadvantages are covered in this chapter.
  4. Accounting for Special Transactions 15%-20%
  • Bill of Exchange and Promissory Notes: Accounting treatments relating to issue, acceptance, discounting, maturity and endorsement of bills, accommodation bills, special cases of insolvency and early retirement of bill are covered in this chapter.
  • Sale of Goods on Approval or Return Basis: Accounting treatment of sales on approval or return basis is covered in this chapter.
  • Consignment: Difference between sale and consignment, accounting treatment for consignment transactions, distinction between various types of commissions is covered in this chapter.
  • Average Due Date: Calculation of average due dates, days of grace, maturity period, etc. covered in this chapter.
  • Account Current: Methods of Preparation of Account Current & its calculations are covered in the chapter.
  1. Preparation of Final Accounts of Sole Proprietors 30$-40%
  • Final Accounts of Non-Manufacturing Entities: Final Accounts preparation of non-manufacturing entities including Trading Account, Profit and Loss Account and Balance Sheet.
  • Final Accounts of Manufacturing Entities: Final Accounts preparation of manufacturing entities including Manufacturing Account, Profit and Loss Account and Balance Sheet.
  1. Partnership Accounts
  • Introduction to Partnership Accounts: Profit & Loss Appropriation Account, two methods of Partner’s Capital Account -fixed and fluctuating, Rectification of errors, etc. is covered in the chapter along with provisions of Indian Partnership Act, 1932 and the Limited Liability Partnership Act, 2008.
  • Treatment of Goodwill in Partnership Accounts: This chapter covers Accounting of goodwill in case of Change in Profit Sharing Ratio, Admission of Partner, Retirement or death of partner, when business is dissolved or sold.
  • Admission of a New Partner: Accounting treatment in case of admission of new partner, Revaluation of Assets and Re computation of liabilities, treatment of reserves, Calculation of New Profit-Sharing Ratio is covered in this chapter.
  • Retirement of a Partner: Accounting treatment in case of retirement of partner, Computation of Gaining Ratio, Revaluation of Assets & Liabilities, Joint Life Policy are few of the concepts covered over here.
  • Death of Partner: Accounting treatment in case of death of partner, Joint Life Policy, etc. is covered in this chapter.
  1. Financial Statements of Not-for-Profit Organizations: Preparation of Receipts and Payments Account, Income and Expenditure Account, Balance Sheet of Not-for-Profit Organizations.
  2. Company Accounts 10%-15%
  • Introduction to Company Accounts: Nature and Types of Companies, Salient Features of Company, Purpose of Preparing Financial Statements of Company are covered in this chapter.
  • Issue, Forfeiture and Re-Issue of Shares: Types of Shares and Share Capital, Accounting treatment in case of under subscription, over subscription of shares, call-in-arrears, call-in-advance, forfeiture of shares, re-issue of shares, treatment of shares issued for consideration other than cash are the things covered in this chapter.

Issue of Debentures: Types of Debentures, Accounting for Issue of Debentures, write off discount on debentures, interest on debentures calculation is covered in this chapter.