CISCE Syllabus For Class 12 Accounts: Knowing the Syllabus is very important for the students of Class 12. Shaalaa has also provided a list of topics that every student needs to understand.
The CISCE Class 12 Accounts syllabus for the academic year 2023-2024 is based on the Board's guidelines. Students should read the Class 12 Accounts Syllabus to learn about the subject's subjects and subtopics.
Students will discover the unit names, chapters under each unit, and subtopics under each chapter in the CISCE Class 12 Accounts Syllabus pdf 2023-2024. They will also receive a complete practical syllabus for Class 12 Accounts in addition to this.
CISCE Class 12 Accounts Revised Syllabus
CISCE Class 12 Accounts and their Unit wise marks distribution
CISCE Class 12 Accounts Course Structure 2023-2024 With Marking Scheme
# | Unit/Topic | Weightage |
---|---|---|
I | Partnership Accounts | |
1.1 | Fundamentals of Partnership | |
1.2 | Goodwill | |
1.3 | Reconstitution of Partnership | |
II | Joint Stock Company Accounts | |
2.1 | Issue of Shares | |
2.2 | Issue of Debentures | |
2.3 | Redemption of Debentures | |
2.4 | Final Accounts of Companies | |
III | Financial Statement Analysis | |
IV | Cash Flow Statement (Only for Non-financing Companies) | |
V | Ratio Analysis | |
5.1 | Liquidity Ratios | |
5.2 | Solvency Ratios | |
5.3 | Activity Ratios | |
5.4 | Profitability Ratios | |
VI | Accounting Application of Electronic Spread Sheet | |
VII | Database Management System (DBMS) | |
Total | - |
Syllabus
CISCE Class 12 Accounts Syllabus for Partnership Accounts
- Meaning and Definitions of Partnership and Partnership Deed
- Features of Partnership
- The Indian Partnership Act 1932
- Methods of Capital Accounts - Fixed and Fluctuating Capital Method
- Preparation of Profit and Loss Appropriation Account
- Partners Current Accounts When Fixed Capital Method is Followed
- Adjustments - Interest on Capital, Drawings and Loans
- Interest on Current Accounts (Debit and Credit) Salary
- Division of Profit Among Partners
- Transfer to Reserves
- Commission to Partners and Managers
Definition, meaning and features of a Partnership
- Self explanatory.
Provisions of The Indian Partnership Act, 1932, with respect to books of accounts.
- Meaning and importance
- Rules applicable in the absence of a partnership deed
Preparation of Profit and Loss Appropriation Account and Partners’ Capital and Current Accounts.
- Profit and Loss Appropriation Account.
- Partners’ capital accounts: fixed and fluctuating
- Partners’ Current Accounts when fixed capital method is followed
- Interest on capital, interest on drawings, interest on current accounts (debit and credit) salary, commission to partners and
managers, transfer to reserves, division of profit among partners - Guarantee of profits
- Past adjustments (Relating to interest on capital, interest on drawing, salary and Profit Sharing Ratio).
NOTE:
- Interest on loan given by the partner to the firm is to be taken as a charge against profits. This interest will be debited to the
P/L account and credited to his loan account. - Interest on loan taken by a partner fromthe firm should be credited to P/L account and debited to his capital/current account as the case may be.
- Rent paid to a partner is a charge against profit and is to be credited to partners’ current account in case of fixed capital system or to partners’ capital account when capitals are fluctuating.
- Admission of manager as a Partner is excluded
- Concept of Goodwill
- Meaning of Goodwill
- Nature and Features of Goodwill
- Factors Affecting the Value of Goodwill
- Need for Valuation of Goodwill
- Methods of Valuation of Goodwill
- Average Profits Method
- Super Profits Method
- Capitalisation Methods
- Treatment of Goodwill
- Premium Method
- Revaluation Method
- Hidden Goodwill
- Practical Application of Average Profit Method
- Simple Average Method
- Weighted Average Method
- Practical Application of Super Profit Method
- Practical Application of Capitalization Method
- Factors Affecting Goodwill
- Capitalization of Average Profit
- Capitalization of Super Profit
Concept of goodwill and mode of valuation
- Meaning, nature and features of Goodwill.
- Factors affecting the value of goodwill.
- Mode of Valuation.
- Average profit method –Meaning and practical application
- Simple average.
- Weighted average method.
- Super profit method – Meaning and practical application.
- Capitalization method – Meaning and practical application
- Capitalization of average profit.
- Capitalization of super profit.
NOTE: Capital Employed/Net assets are Total assets (excluding goodwill if existing in the balance sheets and fictitious assets) less
outside liabilities.
- Admission of a Partner - Sacrifice Ratio and New Ratio
- Admission - Calculation of Gaining Ratio
- Admission of a Partner - Adjustment of Capitals
- Adjustment of old partner’s Capital Accounts on the basis of the new partner’s capital
- Calculation of New Partner’s Capital on the Basis of Old Partner’s Adjusted Capital
- Admission of a Partner - Treatment of Goodwill
- Admission of a Partner - Adjustment of Accumulated Profits and Losses
- Preparation of Revaluation Account and Balance Sheet
- Change in Profit Sharing Ratio
- Change in PSR takes place at the time of admission of a partnership firm.
- Accounting treatment of accumulated profits and losses through one journal entry:
- Gaining partners cap/current A/c Dr.
- To sacrificing Partners cap/current (in case of profits).
- Sacrificing partners’ cap/current A/c Dr.
- To Gaining Partners cap/current (in case of losses)
- General Reserve/ Reserve fund, Workmen Compensation Reserve/ Fund, Investment Fluctuation Reserve/ Fund, Contingency Reserve, Profit and Loss Account (Debit and Credit Balance) and Advertisement Suspense Account/ Deferred Revenue Expenditure
- Retirement and Death of a Partner - Calculation of New Profit Sharing Ratio
- Retirement and Death of a Partner - Gaining Ratio
- Retirement Or Death of a Partner - Preparation of Loan Account of the Retiring Partner
- Retirement and Death of a Partner - Sacrificing Ratio
- Adjustment with Regard to Goodwill Including Hidden Goodwill
- Adjustment with Regard to Undistributed Profits and Losses
- Adjustment with Regard to Share of Profits of the Retiring Or Deceased Partner from the Date of the Last Balance Sheet to the Date of Retirement Or Death
- Through P & L Suspense A/c (in case of no change in PSR of remaining partners).
- Through Gaining Partners capital/ current A/c (in case of change in PSR of remaining partners).
- Retirement and Death of a Partner - Adjustment of Capitals
- Readjusting the adjusted capital of the continuing partners in the new profit sharing ratio.
- Adjusting the capitals of the continuing partners on the basis of the total capital of the new firm.
- When the continuing partners bring in cash to pay off the retiring partners.
- Preparation of Revaluation Account on Retirement Or Death of a Partner
- Calculation and Payment of Amount Due to Retiring Partner
- Dissolution of Partnership Firm
- Dissolution of a Partnership Firm - Settlement of Accounts
- Settlement of accounts under Section 48 of The Indian Partnership Act 1932
- Dissolution of a Partnership Firm - Preparation of Realization Account, and Other Related Accounts
- Capital accounts of partners
- Cash and bank a/c (excluding piecemeal distribution, sale to a company and insolvency of partner(s)).
- Dissolution of a Partnership Firm - Partner’s Loan Account
Admission
Calculation of new profit sharing ratio, sacrificing ratio and gaining ratio.
Self Explanatory
Accounting treatment of goodwill on admission of a partner.
Based on Accounting Standard –26 issued by the Institute of Chartered Accountants of India in the context of Intangible Assets.
- Premium for goodwill paid privately.
- Premium for goodwill paid (in cash or kind) and retained in the business.
- Premium for goodwill paid and withdrawn by the old partners.
- When the incoming partner cannot bring premium for goodwill in cash, adjustments are to be done through his current account.
- Hidden goodwill.
- When goodwill appears in the old Balance Sheet.
Preparation of Revaluation Account.
- Preparation of a Revaluation Account where changes in the values of assets and liabilities are reflected in the new Balance Sheet after reconstitution of a partnership firm.
NOTE: Memorandum revaluation account is excluded from the syllabus.
Accounting treatment of accumulated profits and losses.
- General Reserve / Reserve Fund, Workmen Compensation Reserve/ Fund, Investment Fluctuation Reserve/Fund, Contingency Reserve, Profit and Loss Account (Debit andCredit balance) and Advertisement Suspense Account/ Deferred Revenue Expenditure.
Adjustment of Capitals
- Adjustment of old partner’s Capital Accounts on the basis of the new partner’s capital.
- Calculation of new partner’s capital on the basis of old partner’s adjusted capital.
Change in Profit Sharing Ratio.
- Change in PSR takes place at the time of admission of a partnership firm.
- Accounting treatment of accumulated profits and losses through one journal entry:
- Gaining partners cap/current A/c Dr.
- To sacrificing Partners cap/current (in case of profits).
- Sacrificing partners’ cap/current A/c Dr.
- To Gaining Partners cap/current (in case of losses)
- General Reserve/ Reserve fund, Workmen Compensation Reserve/ Fund, Investment Fluctuation Reserve/ Fund, Contingency Reserve, Profit and Loss Account (Debit and Credit Balance) and Advertisement Suspense Account/ Deferred Revenue Expenditure
Retirement and death of a partner
Calculation of new profit sharing ratio, gaining ratio and sacrificing ratio.
- Self Explanatory.
Adjustment with regard to goodwill including hidden goodwill.
- Self Explanatory.
Adjustment with regard to undistributed profits and losses.
- Self Explanatory.
Adjustment with regard to share of profits of the retiring or deceased partner from the date of the last Balance Sheet to the date of
retirement or death (on the basis of time or turnover).
- Through P & L Suspense A/c (in case of no change in PSR of remaining partners).
- Through Gaining Partners capital/ current A/c (in case of change in PSR of remaining partners).
Preparation of Revaluation Account on retirement or death of a partner.
- Self Explanatory.
Adjustment of capitals.
- Readjusting the adjusted capital of the continuing partners in the new profit sharing ratio.
- Adjusting the capitals of the continuing partners on the basis of the total capital of the new firm.
- When the continuing partners bring in cash to pay off the retiring partners.
Calculation and payment of amount due to retiring partner.
- Self Explanatory.
Preparation of retiring partner’s loan accounts and deceased partner’s executor’s loan account (with interest on loan accrued and due and interest on loan accrued but not due).
- Self Explanatory
Change in Profit Sharing Ratio.
- Change in PSR takes place at the time of retirement / death of a partnership firm.
- Accounting treatment of accumulated profits and losses through one journal entry:
- Gaining partners cap/current A/c Dr.
- To sacrificing Partners cap/current (in case of profits).
- Sacrificing partners’ cap/current A/c Dr.
- To Gaining Partners cap/current (in case of losses)
- General Reserve/ Reserve fund, Workmen Compensation Reserve/ Fund, Investment Fluctuation Reserve/ Fund,
Contingency Reserve, Profit and Loss Account (Debit and Credit Balance) and Advertisement Suspense Account/ Deferred Revenue Expenditure
NOTE:
Preparation of Balance Sheet in Partnership Accounts to be done in Horizontal format only.
Memorandum Revaluation Account, Joint Life Policy, Individual life policy are excluded from the syllabus.
Dissolution of a Partnership firm.
Meaning of dissolution and settlement of accounts under Section 48 of The Indian Partnership Act 1932.
- Self Explanatory
Preparation of Realization Account, Partner’s Loan Account, Partner’s Capital Account and Cash/Bank Account.
- Self-explanatory
NOTE:
- When an asset or a liability is taken to the realization account any corresponding/related fund or reserve is also transferred to
realization account and not to capital account. - When accounts are prepared on a fixed basis, partners current account balances are to be transferred to capital account. No adjustments are required to be passed through current account.
- Bank overdraft is to be taken to the bank/cash A/c and not to be transferred to realization account but bank loan must be transferred to realization account.
- If question is silent about the payment of a liability, then it is has to be paid out in full.
- If the question is silent about the realization of an asset, its value is assumed to be nil.
- Loan taken from a partner will be passed through cash or bank account.
- Loan given to a partner will be transferred (debited) to his Capital account.
- Admission cum retirement, amalgamation of firms and conversion/sale to a company
together with piecemeal distribution and insolvency of a partner / partners not required.
CISCE Class 12 Accounts Syllabus for Joint Stock Company Accounts
- Issue of Shares for Consideration Other than Cash
- Calls in Advance and Arrears
- Over Subscription of Shares
- Under Subscription of Shares
- Prorata Allotment of Over and Under Subscription
- Accounting Treatment of Forfeiture and Re-issue of Share
- Disclosure of Share Capital in Company’s Balance Sheet (Horizontal Form)
Problems on issue of shares.
- Issue of shares at par and premium under Companies Act, 2013.
- Issue of shares for considerations other than cash:
- To promoters (can be considered either through Goodwill account or Incorporation costs account).
- To underwriters.
- To vendors.
- Calls in arrears, calls in advance and interest thereon including the preparation of ledger accounts.
- Over and undersubscription (including prorata allotment).
NOTE: In prorata allotment when shares are issued at a premium, excess money received on application will first be adjusted towards the share capital. Any excess thereon will be utilized towards the Securities Premium Reserve.
When allotment or any call money is due, it is to be transferred to the calls in arrears account, on which interest if provided in the
Articles of Association will be calculated.
- Forfeiture and reissue of shares at par, premium or discount.
Self explanatory. - Disclosure of Share capital in the company’s Balance Sheet. *
NOTE: Issue of bonus and rights shares, private placement of shares, sweat equity shares, employees’ stock option scheme, reservations for small individual participants and minimum tradable lots are not required.
- Problems on Issue of Debentures
- Issue of Debentures at Par at Premium and at Discount
- Issue of debentures at par, at premium and at discount under Companies Act 2013.
- Issue of Debentures as Collateral Security for a Loan
- Issue of Debentures for Consideration Other than Cash
- To promoters
- To underwriters
- To vendors
- Accounting Entries at the Time of Issue When Debentures Are Redeemable at Par and Premium
- Calls in Arrears, Calls in Advance and Interest Thereon
- Interest on Debentures
- Interest on debentures (with TDS)
- Disclosure of Debentures in the Company’s Balance Sheet
- Methods of Writing off Discount / Loss on Issue of Debentures
- When debentures are redeemable in a lump sum at the end of a specified period;
- When debentures are redeemable in instalments
- Disclosure of Discount on Issue of Debentures in the Company’s Balance Sheet When Debentures Are Redeemed in Instalments
Problems on issue of debentures (at par, at premium and at discount.)
Problems on issue of debentures to include:
- Issue of debentures at par, at premium and at discount under Companies Act 2013.
- Issue of debentures as collateral security for a loan.
- Issue of debentures for considerations other than cash.
- To promoters.
- To underwriters.
- To vendors
- Accounting entries at the time of issue when debentures are redeemable at par and premium.
- Interest on debentures (with TDS).
- Disclosure of Debentures in the company’s Balance Sheet.
- Disclosure of discount on issue of debentures in the company’s Balance Sheet when debentures are redeemed in instalments.
NOTE:
Premium on the redemption of debentures to be recorded under the head → Non Current Liabilities, subhead → Long Term Borrowings.
- Creation of Debenture Redemption Reserve
- Redemption of Debentures Out of Profits
- Redemption of Debentures Out of Capital
- Redemption of Debentures for Immediate Cancellation - Draw of Lots, Lump Sum and Purchase in the Open Market
- Creation of Debenture Redemption Reserve (DRR).
- Redemption of debentures out of profits.
- Redemption of debentures out of capital.
- Redemption of debentures in a lump sum.
- Redemption of debentures in annual instalments by draw of lots.
- Redemption of debentures by purchase in the open market.
- Self-Explanatory.
NOTE: Calculation of ex-interest and cum-interest are not required.
- Preparation of Balance Sheet
- Preparation of Balance sheet from receipt and payment account with additional information
- Statement of Profit and Loss and Balance Sheet in the Prescribed Form with Major Headings and Sub Headings
- Preparation of Comparative Balance Sheet and Statement of Profit and Loss (Inter-firm and Intrafirm) Showing Absolute Change and Percentage Change
- Common Size Statement of Profit and Loss to Be Prepared as a Percentage of Revenue from Operations
Preparation of the Balance Sheet of a company (along with notes to accounts) as per Schedule III Part I of Companies Act
2013. **
NOTE: Schedule III Part II of Companies Act 2013 (Statement of Profit and Loss) is not required for the purpose of preparing final accounts of a Company.
However, for the preparation of Comparative and Common Size Income Statements (Section B – Unit 4: Financial
Statement Analysis), the extent and format of the Statement of Profit and Loss as per
Schedule III Part II of the Companies Act 2013 to be studied is as follows:
Statement of Profit and Loss for the year ended:………………..
Particulars | Note No. | Figures for the Current reporting period | Figures for the Previous reporting period | |
I | Revenue from operations | |||
II | Other Income | |||
III | Total Revenue (I + II) | |||
IV | Expenses: Purchases of Changes in Work-inprogress Employee Finance costs Depreciation Other expenses Total expense | |||
V | Profit before tax (III-IV) | |||
VI | Less Tax | |||
VII | Profit after Tax (V-VI) |
CISCE Class 12 Accounts Syllabus for Financial Statement Analysis
- Comparative Statements
- Common Size Statements
- Significance and Limitations of Comparative Statements
- significance and limitations of Comparative Statements of Common Size Statements
- Preparation of Comparative Balance Sheet and Statement of Profit and Loss (Inter-firm and Intrafirm) Showing Absolute Change and Percentage Change
- Common Size Balance Sheet to Be Prepared as a Percentage of Total Assets and Total Liabilities
- Common Size Statement of Profit and Loss to Be Prepared as a Percentage of Revenue from Operations
- Comparative Statements and Common Size Statements.
- Meaning, significance and limitations of Comparative Statements and Common Size Statements.
- Preparation of Comparative Balance Sheet and Statement of Profit and Loss (inter-firm and intrafirm) showing absolute change and percentage change.
- Common size Balance Sheet to be prepared as a percentage of total assets and total liabilities.
- Common size Statement of Profit and Loss to be prepared as a percentage of Revenue from operations
NOTE: Preparation of comparative statements and common size statements to be made from the Balance Sheets and Statements of P/L without notes to accounts.
CISCE Class 12 Accounts Syllabus for Cash Flow Statement (Only for Non-financing Companies)
- Concept of Cash Flow Statement
- Meaning of Cash Flow Statement
- Objectives of Cash Flow Statement
- Importance of Cash Flow Statement
- Preparation of Cash Flow Statement
- (as per AS3 (Revised) (Indirect Method only)
- Calculation of Net Cash Flows from Operating Activities Based on Indirect Method
- Preparation of a Cash Flow Statement from two consecutive years’ Balance Sheet with or without adjustments.
- Preparation of complete/partial cash flow statement from extracts of Balance Sheets and Statements of P/L with or without adjustments.
- Preparation of Cash Flow Statement on Basis of Operating, Investing
Calculating net cash flows from investing activities:
- Cash purchase of fixed assets.
- Cash sale of fixed assets.
- Purchase of shares or debentures or long term investments of other companies.
- Interest and dividend received on shares or debentures or long term investments of other companies.
- Sale of shares or debentures or long term investments of other companies
- Preparation of Cash Flow Statement on Basis of Financing Activities
- The following items are to be taken when calculating net cash flows from financing activities:
- Issue or redemption of shares at par, issue of debentures at par and discount, the redemption of debentures at par.
- Interest paid on Long Term and Short Term Borrowing and dividend – interim and proposed/paid on shares.
- Long term borrowings and Short term borrowings – bank overdraft, cash credit and short term loan. whether taken or repaid.
- Share issue expenses/underwriting commission paid.
- Cash and Cash Equivalents
- Cash
- Bank
- Short term investments
- Marketable securities
- Cash
Meaning, importance and preparation of a Cash Flow Statement
- NOTE: Based on Accounting Standard – 3 (revised) issued by the Institute of Chartered Accountants of India.
Calculation of net cash flows from operating activities based on Indirect Method only.
- Preparation of a Cash Flow Statement from two consecutive years’ Balance Sheet with or without adjustments.
- Preparation of complete/partial cash flow statement from extracts of Balance Sheets and Statements of P/L with or without adjustments.
NOTE: Any adjustment or an item in the Balance Sheet relating to issue of bonus shares, extraordinary items and refund of tax are not required.
Preparation of Cash Flow Statement on basisof operating, investing and financing activities.
The following items are to be taken when calculating net cash flows from financing activities:
- Issue or redemption of shares and debentures at par.
- Interest paid on Long Term and Short Term Borrowings and dividend – interim and proposed/paid on shares.
- Long term borrowings and Short term borrowings – bank overdraft, cash credit and short term loan. whether taken or repaid.
- Share issue expenses / underwriting commission paid.
The following items are to be taken when calculating net cash flows from investing activities:
- Cash purchase of fixed assets.
- Cash sale of fixed assets.
- Purchase of shares or debentures or long term investments of other companies.
- Interest and dividend received on shares or debentures or long term investments of other companies.
- Sale of shares or debentures or long term investments of other companies
The following items are to be taken for cash and cash equivalents:
- Cash
- Bank
- Short term investments
- Marketable securities
NOTE: Adjustments relating to provision for taxation, proposed dividend, interim dividend, amortization of intangible assets, profit or loss on sale of fixed assets including provision for/accumulated depreciation on them, Profit or loss on sale of investment are
also included.
To calculate cash flow from operating activities the Adjusted Profit and Loss Account is not acceptable as per AS-3.
Calculation of Net Profit before Tax has to be shown as a Working Note
CISCE Class 12 Accounts Syllabus for Ratio Analysis
- Liquidity Ratios
Current Ratio: `"Current Assets"/"Current Liabilities"`
Current Assets = Current Investments + Inventories (excluding Loose Tools and Spare Parts) + Trade Receivables + Cash and Bank Balance + Short-term Loans and Advances + Other Current Assets
Current Liabilities = Short term borrowings + Trade payables + Other Current Liabilities + Short term Provisions.
Quick Ratio / Liquid Ratio : `"Quick Assets"/"Current Liabilities"`
Or
`"All Current Assets- Inventories(excluding Loose Tools and Spare Parts)- Prepaid Expenses"/"Current Liabilities"`
Or
`"Liquid Assets"/"Current Liabilities"`
``
Current Assets = Current Investments + Inventories (excluding Loose Tools and Spare Parts) + Trade Receivables + Cash and Bank
Balance + Short-term Loans and Advances + Other Current Assets
Current Liabilities = Short term borrowings + Trade payables + Other Current Liabilities + Short term Provisions
``
OR
``
OR
``
- Solvency Ratios - Debt to Equity Ratio
Debt to Equity Ratio: `"Debt / Long Term Debt"/"Equity / Shareholders' Funds"`
Debt = Long Term Borrowings + Long Term Provisions
Equity / Shareholders’ Funds = Share Capital + Reserves and Surplus
Or
Non Current Assets + (Current Assets – Current Liabilities) - Non Current Liabilities
= Non Current Assets + Working Capital- Non Current Liabilities
= (Tangible Assets + Intangible Assets + Non Current Investments + Long Term Loans and Advances) + Working Capital – (Long Term Borrowings + Long Term Provisions)
- Solvency Ratios - Proprietary Ratio
Proprietary Ratio: `"Shareholders Funds/ Equity"/"Total Assets"`
Total Assets = Non Current Assets + Current Assets = Tangible Assets + Intangible Assets + Non Current Investments + Long Term Loans and Advances
+
Current Investments + Inventories (including Loose Tools and Spare Parts) + Trade Receivables + Cash
and Bank Balance + Short-term Loans and Advances + Other Current Assets - Solvency Ratios - Debt to Total Assets Ratio
Debt to Total Assets Ratio: Debt/Total Assets
- Solvency Ratios - Interest Coverage Ratio
Interest coverage ratio = Net profit before interest and taxes/Interest
Interest includes interest on only long term borrowings.
``
Debt = Long Term Borrowings + Long Term Provisions
Equity / Shareholders’ Funds = Share Capital + Reserves and Surplus
OR
Non Current Assets + (Current Assets – Current Liabilities) - Non Current Liabilities
= Non Current Assets + Working Capital- Non Current Liabilities
= (Tangible Assets + Intangible Assets + Non Current Investments + Long Term Loans and Advances) + Working Capital – (Long Term Borrowings + Long Term Provisions)
``
Total Assets = Non Current Assets + Current Assets = Tangible Assets + Intangible Assets + Non Current Investments + Long Term Loans and Advances
Current Investments + Inventories (including Loose Tools and Spare Parts) + Trade Receivables + Cash and Bank Balance + Short-term Loans and Advances + Other Current Assets
``
"Interest coverage ratio" ="Net profit before interest and taxes"/"Interest"
Interest includes interest on only long term borrowings
- Activity Ratios - Trade Receivables Turnover Ratio
Trade Receivable Turnover Ratio: = Credit Revenue from Operation/Average Trade Receivable
Credit Revenue from Operation = Revenue from Operation – Cash Revenue from Operation
Average Trade Receivables = Opening Trade Receivable + Closing Trade Receivable/2
- Activity Ratios - Trade Payables Turnover Ratio
Trade Payable Turnover Ratio: = Net Credit Purchases/Average Trade Payable
Average Trade Payables = Opening Trade Payable + Closing Trade Payable / 2
- Activity Ratios - Working Capital Turnover Ratio
Working Capital Turnover Ratio = Revenue from Operations/Working Capital
- Activity Ratios - Inventory Turnover Ratio
Inventory Turnover Ratio = (Cost of Goods Sold /Cost of Revenue from Operation)/Average Inventory
Cost of goods sold= Opening Stock + Net Purchases + Direct Expenses – Closing Stock
Cost of Revenue from Operations = Revenue from Operations – Gross Profit
Or
Cost of Material Consumed (including direct expenses) + Change in inventories of WIP and Finished Goods
Or
Opening Inventory + Net Purchases+ Direct Expenses – Closing inventory
Average Inventory = (Opening Inventory + Closing Inventory)/2
Debtors Turnover Ratio will be replaced by
``
Credit Revenue from Operation = Revenue from Operation – Cash Revenue from Operation
``
Creditors Turnover Ratio will be replaced by
``
``
``
Stock Turnover Ratio will be replaced by Inventory Turnover Ratio = Cost of Goods Sold /
``
Cost of goods sold= Opening Stock + Net Purchases + Direct Expenses – Closing Stock
Cost of Revenue from Operations = Revenue from Operations – Gross Profit
Or
Cost of Material Consumed (including direct expenses) + Change in inventories of WIP and Finished Goods
Or
Opening Inventory + Net Purchases+ Direct Expenses – Closing inventory
``
- Profltabtltty Ratios - Gross Profit Ratio
Gross Profit Ratio: `"Gross Profit"/"Revenue from Operations"xx100`
Gross Profit = Revenue from Operations – Cost of Revenue from Operations/ Cost of Goods Sold
Cost of Revenue from Operations = Cost of Material Consumed (including direct expenses) + Change in inventories of WIP and Finished Goods.Or
Opening Inventory + Net Purchases + Direct Expenses – Closing inventory
- Profitability Ratios - Net Profit Ratio
Net Profit Ratio = `"Net Profit"/"Revenue from Operations"xx100`
Net Profit = Gross profit + Other Income – Indirect Expenses – Tax
- Profitability Ratios - Operating Ratio
Operating Ratio =``
Operating Expenses = Employee Benefit Expenses + Depreciation and Amortisation Expenses + Selling
and Distribution Expenses+ Office and Administrative ExpenseOperating Income = Sale of scrap, trading commission received, cash discount received, revenue from services.
- Profitability Ratios - Operating Profit Ratio
Operating Profit Ratio : ``
Net operating profit = Net Profit after Tax+ Non-Operating Expenses – Non Operating Incomes
Or
Gross Profit – Operating Expenses + Operating Incomes
Non Operating Expenses = Finance Cost (Interest on Borrowings) + Loss on sale of Non Current Assets
Non Operating Incomes = Interest and Dividend Received on Investment + Profit on sale of Non Current Assets
- Profitability Ratios - Earning per Share
`"Earning per share" = "Net Profit after Tax and Preference Dividend"/"No. of Equity Shares"`
- Profitability Ratios - Price Earning Ratio
`"Price Earning Ratio" = "Market Value of an Equity share"/"Earning per share"`
- Profitability Ratios - Return on Investment
Return on Investment = `"Net Pr ofit before Interest and Tax"/"Capital Employed"xx100`
Gross Profit Ratio
``
Gross Profit = Revenue from Operations – Cost of Revenue from Operations/ Cost of Goods SoldCost of Revenue from Operations = Cost of Material Consumed (including direct expenses) + Change in inventories of WIP and Finished Goods
OR
Opening Inventory + Net Purchases + Direct Expenses – Closing inventory
Net Profit Ratio
``
Net Profit = Gross profit + Other Income – Indirect Expenses – Tax
Operating Ratio:
"Cost of Revenue from Operations/Cost of Goods Sold + Operating Expenses"/"Revenue from Operations"xx100
Operating Expenses = Employee Benefit Expenses + Depreciation and Amortisation Expenses + Sellingand Distribution Expenses+ Office and Administrative Expense.
Operating Income = Sale of scrap, trading commission received, cash discount received, revenue from services
Operating Profit Ratio:
``
Net operating profit = Net Profit after Tax+ Non-Operating Expenses – Non Operating Incomes
OR
Gross Profit – Operating Expenses + Operating Incomes
Non Operating Expenses = Finance Cost (Interest on Borrowings) + Loss on sale of Non Current Assets
Non Operating Incomes = Interest and Dividend Received on Investment + Profit on sale of Non Current Assets
Earning per share:
``
Price Earning Ratio:
``
Return on Investment
`=`
NOTE:
- Current Ratio includes Net Debtors (Gross Debtors – Provision for doubtful debts) while Trade Receivables Turnover Ratio includes Gross
Debtors. - Capital employed = Shareholders’ Funds + Non-current liabilities – non trade investments
OR
Non-current assets (excluding Non-trade investments) + Working Capital
OR
Fixed Assets + Trade Investments + Working Capital
CISCE Class 12 Accounts Syllabus for Accounting Application of Electronic Spread Sheet
- Meaning of Electronic Spreadsheet
- Concept of Electronic Spreadsheet (ES)
- Utility of Electronic Spreadsheet
- Features Offered by Electronic Spreadsheet
- Merits and Demerits of Electronic Spreadsheets
- Generating Accounting Information - Payroll
- Application of Spreadsheets in Generating Accounting Information - Components of Payroll
- Basic, HRA, DA and TA, CCA, deduction for PF and income tax.
- Application of Spreadsheets in Generating Accounting Information - Data Presentation
- Graphs and charts- using wizards, various charts type, formatting grid lines and legends, previewing & printing charts
- Application of Spreadsheets in Generating Accounting Information - Database
- Creation, sorting, query and filtering a database.
Concept of Electronic Spreadsheet.
- Meaning, utility, merits and demerits of Electronic spreadsheets
Features offered by Electronic Spreadsheet.
- An understanding of basic features of electronic spreadsheets such as: Creating worksheet, entering data into worksheet, heading information, data, text, dates, alphanumeric values, saving & quitting worksheet. Opening and moving around in an existing worksheet. Toolbars and Menus,keyboard shortcuts. Working with single and multiple workbooks - copying, renaming, moving, adding and deleting, copying entries and moving between workbooks. Formatting of worksheet- Auto format, changing - alignment, character styles, column width,
date format, borders and colours. Previewing and Printing worksheet - Page setting, Print titles, Adjusting margins, Page break, headers and footers. Formulas – summation, subtraction, division, multiplication, average and percentage. Functions: date, if-thenelse,
freezing panes.
Application of spreadsheets in generating the following accounting information
- Payroll
- Components of payroll – Basic, HRA, DA and TA, CCA, deduction for PF and income tax.
- Data Presentation
- Graphs and charts- using wizards, various charts type, formatting grid lines and legends, previewing & printing charts
- Database - creation, sorting, query and filtering a database.
CISCE Class 12 Accounts Syllabus for Database Management System (DBMS)
- Database Management System (DBMS)
- Introduction to DBMS
- Evolution of DBMS
- DBMS Concepts
- Characteristics of Database Management System
- Advantages of DBMS
- Components of DBMS
- Type of Database Management System (Dbms)
- Features of Database Management System (DBMS)
- A conceptual understanding of the basic features of the Data Base Management System (DBMS), i.e. data update and retrieval using basic functions and commands of SQL.
- Basic Commands: Select, Where, And, Or, Update, Delete and
- Basic Functions: Avg, Count, Max, Min, Sum.
- DBMS in Business Application
- Using queries, forms, and reports for generating accounting information.
- Database design, tables, fields, relationships, forms reports and indexing.
- Applications of DBMS in generating accounting information such as shareholders’ records, sales reports, customers’ profiles, suppliers’ profiles payroll, employees’ profiles, and petty cash registers.
- The following examples of DBMS in business applications:
- Accounting Information
- Debtors and Creditors
- Bank Reconciliation Statement
- Asset Accounting
Concept and Features of DBMS.
Types and features of DBMS
A conceptual understanding of the basic features of Data Base Management System (DBMS), i.e. data update and retrieval using basic functions and commands of SQL.
Basic Commands: Select, Where, And, Or, Update, Delete and Basic Functions: Avg, Count, Max, Min, Sum.
DBMS in Business Application
Database design, tables, fields, relationships, forms reports and indexing
The following examples of DBMS in business application:
- Accounting Information
- Debtors and Creditors
- Bank Reconciliation Statement
- Asset Accounting