Syllabus of A2

A. Financial Accounting
1. Manufacturing Accounts
2. Not for profit organizations(clubs and societies)
3. Published company accounts
4. Auditing and stewardship of limited company
5. Statement of cash flows
6. Business purchase and mergers
7. Consignments and joint ventures accounts
8. Computerized accounting systems
9. Analysis and communications of accounting
information
 Syllabus of A2 Contd..

B. Cost & Managerial Accounting

1. Activity-based costing(ABC)
2. Budgeting and budgetary control
3. Standard costing
4. Investment Appraisal
 Manufacturing accounts
Cost classification( types of costs):
1. Raw material
• Direct material
• Indirect material
2. Labour
• Direct labour
• Indirect labour
3. Expenses
• Direct expenses
• Indirect expenses
 Manufacturing accounts contd..
Prime cost
Prime cost = the sum of all direct expenses
Or
Prime cost = Direct material+Direct labour+Direct expenses
Overheads
Overheads= the sum of all indirect expenses
Or
Overheads= Indirect material+Indirect labour+Indirect expenses
Types of overheads:
1. Production/Manufacturing overheads
2. Non-production/Non-manufacturing overheads(selling, distribution
marketing, administration, finance, R& D etc.)
 Manufacturing accounts contd..
Goods or inventory:
• Raw material inventory
• Work in progress inventory( partly completed
goods)
• Finished goods inventory( Ready for sell)
 Manufacturing accounts contd..
Calculation of Transfer Price:
A. If profit on total cost or mark-up is given:
Factory profit =(Total manufacturing cost
X % profit/100)
Transfer price= (Total manufacturing cost
+ factory profit)
B. If profit on transfer price or margin is given:
Factory profit=( Total manufacturing cost X % profit)
/(100 -% profit)
Transfer price= (Total manufacturing cost
+ factory profit)
 Manufacturing accounts contd..
Calculation of Unrealised Profit/ Profit included
in closing stock:
Unrealised profit = % mark-up *[value of the
opening/closing inventory]/(100+%mark-up)
Note: It can be used for calculating the
unrealised profit of opening inventory as well
as closing inventory