NOTES FOR A* ON IGCSE ACCOuntin

1- Assets & Liabilities  Assets : is an item of value owned

by a company  Liabilities : are creditors’ claims on assets
that reflect obligations to provide assets, products or
services to others 2- Carriage inwards & Carriage
outwards.  Carriage inwards: is the shipping and
handling costs incurred by a company that is receiving
goods from suppliers (appear in income statement as a
cost of Purchases)  Carriage outwards: is the shipping
and handling costs incurred by a company that is
shipping goods to a customer. (appear in income
statement as a other expenses ) 3- Accounting &
Bookkeeping  Accounting : is an information system –
includes the process of recording, classifying,
summarizing, reporting, analyzing and interpreting the
financial condition and performance of a business – in
order to communicate it to stakeholders for business
decision making.  Bookkeeping: is the process of
recording, in chronological order, the daily transactions
of a business entity. It forms part of the accounting
information system. 4- Error of principle & Error of
Commission.  Error of principle : when a transaction is
entered using the correct amount and on the correct side
but in the wrong account of the same class.  Error of
Commission: when a transaction is entered using the
correct amount and on the correct side but in the wrong
class IGCSE – Accounting 0452 3 5- Debit Note& Credit
note  Debit Note: A document sent to a supplier asking
for allowance for unsatisfactory good ( reduction of the
amount due )  Credit Note: A document sent to a
customer showing allowance given by supplier in respect
of unsatisfactory good ( reduction of the amount due )