TOMAS DEL ROSARIO COLLEGE

Balanga City, Bataan

Syllabus in Accounting 2
Fundamentals of Accounting, Part II
Pre-requisite- Accounting 1
Second Semester, School Year 2009-2010
Mrs. Maria Cristina M. Santiago
I. COURSE DESCRIPTION

This is a continuation of the first course in accounting. It deals with transactions, financial statements and problems peculiar to the operations of partnership and
corporation as distinguished from sole proprietorships. Topics include: partnership formation and operations including accounting for the admission of partners, changes in capital,
and profit and loss sharing ratios; the conversion of an unincorporated enterprise into a corporation; accounting for incorporated enterprises, including the preparation of financial
statements for internal and external purposes and sample financial statements of companies in the service, manufacturing and trading industries.
II. COURSE GOALS

At the end of the course, the student is expected to:

1.
2.
3.
4.
5.

Appreciate better the nature of partnership and corporations, how they are organized and their advantages as forms of business organization.
Understand the concepts of partnership and corporation as forms of business enterprise and the law governing those entities.
Develop skills in the preparation of financial statements of partnership and corporation whether engaged in trading or manufacturing operations.
Be aware of social responsibilities of partnership and corporation.
Appreciate the values of honesty, objectivity, mutual trust and concern for others.

III. TEXTBOOK AND REFERENCES

1.
2.
3.

Ballada, Win Lu, Partnership and Corporation Accounting, 14th edition. Dom Dane Publishers., 2010
Cabrera, Ma. Elenita B., Ledesma, Ester F., Fundamentals of Accounting Volume II, GIC Enterprise & Co., Inc., 2008
http://www.sec.gov.ph

IV. COURSE REQUIREMENTS

1.
2.
3.
4.

Quizzes
Long Examinations
Recitation
Group Activity

V. GRADING SYSTEM

Grades are computed as follows:

Preliminary Average

(C.S. x 2) _+ Preliminary Exam

3

Mid-term Average

(C.S.) x 2) + Mid-term Exam

3

Final Average

(C.S. x 2) + Final Exam

3

Final Grade

Prelim Average = Mid-term Average = Final Average

The class standing is the sum of recitation, quizzes, group, activity, projects, assignment, and attendance.
The following formula is used on grade transmutation.
Raw Score x 50 + 50
Number of items
VI. COURSE OUTLINE

PRELIMINARY PERIOD
Learning Objectives
Students must be able to:
1. recall the preparation of
adjusting and closing entries.
2.

differentiate the nominal

accounts and real accounts.

Students must be able:

1. Define partnership
2.

3.

Differentiate partnership from

a single proprietorship and
corporation.
Discuss the partnership
registration requirements.

Learning contents

Time Allotment

A. Review of the Accounting Process with

emphasis on Adjusting Entries Closing
Entries

Week

Classroom discussion Boardwork

Quiz
Recitation
Seatwork

Week

Classroom discussion

Quiz
Recitation

1.
2.

2.

Learning Assessment

Nominal Accounts
Real Accounts

B. Partnership Form of Business

Organization
1.

Learning Activities

Nature, peculiarity, advantage and

disadvantages
Organizing a partnership
a. Registration
requirements
b. Regulatory bodies

4.

Enumerate the kinds of

partners and partnership.
3.
4.

Students must be able to:

1.
2.

Record transactions involving

Partnership formation.
Prepare the balance sheet of a
partnership form of business
upon formation.

Students must be able to:

1.

enumerate the factors to

consider in arriving at a plan
for dividing profits or losses.

2.

compute the share of each

partner from net income or
loss.

C. Accounting for Partnerships

1.
2.

prepare the entries to distribute

the partnership net income or
loss.

4.

compute bonus based on net

income before bonus or net

1 Week

Lecture-demonstration
Problem Solving

Quiz
Recitation
Seatwork

1 Week

Lecture-demonstration
Problem solving

Quiz
Recitation

Partners Capital Accounts

Partners drawing Accounts

D. Partnership Formulation
1. Valuation of investments partners
2. Adjustment of Accounts prior to
formulation
3. Opening entries
a. Individuals with no
existing business from a
partnership
b. A sole proprietor and
another individual form
a partnership
c. Single proprietorships
converted into
partnership
E. Partnership Operation
1.

2.

3.

involved in registration
like SEC, DTI, BIR, city
or Municipality
Partnership distinguished from
corporation
Kinds of Partnership and Partners

3.
4.

Partners equity in assets

contrasted with share in profits or
losses
Factors to consider in arriving at
a plan for dividing profits or
losses
Rules for the distribution of
profits and losses
Methods of dividing the profits
and loses
a. Equally or in other
agreed ratio
b. Based on Partners

income after bonus.

c.
d.
e.
f.

Students must be able to:

1.

prepare the financial

statements for a partnership

A. preparation of Financial Statements

a.
b.
c.

Students must be able to:

1.

2.

record transactions involving

admission of partners through
transfer of equity.
compute the implied goodwill
upon admission of partner
through purchase.

Students must be able to:

1.

2.

3.

record transactions involving

admission of partners through
investment.
compute the implied goodwill
upon admission of partner
through investment.
compute amount of bonus upon
admission of partner through
investment.

capital contributions
By allowing interest on
capital
By allowing salaries to
partners
By allowing bonus to
partners
By allowing interest,
salaries and bonus

2.
3.

Quiz
Recitation

1 Week

Lecture
Problem solving

Quiz
Recitation

1 Week

Lecture
Problem solving

Quiz
Recitation

Payment to old partners is equal

to interest purchased
Payment to old partner is less
than the interest purchased
payment to old partner is more
than the interest purchased

C. Admission of New partner(s) through

Investment
1.
2.

Lecture-demonstration
Problem solving

Preparation of Income Statement

Preparation of Statement of
Partners Equity
Preparation of Balance Sheet

B. Admission of New Partner(s)

Financial Statements
1.

1 week

Bonus allowed to new partner(s)

Bonus allowed to old partners

MID-TERM PERIOD

Learning Objectives
Students must be able to:
1.
2.
3.

difference liquidation
from dissolution.
prepare the statement of
liquidation.
prepare entries for the sale
of non-cash assets,
payment of liabilities and
distribution of cash to
partners.

Students must be able to:

1.

2.
3.

4.

2.

3.

D. Partnership Dissolution with Liquidation

1.
2.

Define corporation and

distinguish it from
partnership
Cite the registration
requirements for
corporation
Enumerate the advantages
and disadvantages of a
corporate form of

Time Allotment

Learning Activities

Learning Assessment

1 Week

Lecture
Problem solving

Quiz
Recitation

1 Week

Lecture
Problem solving

Quiz
Recitation

Classroom discussion

Quiz
Recitation

Distinction between dissolution and

liquidation
Lump-sum liquidation
a. Recording sale of non-cash
assets
b. Closing Gain or Loss on
realization
c. Payment of liabilities
d. Payment of partners loan
e. Payment of capital

3.

Installment liquidation
a. Schedule of safe payments
b. Cash priority Program
c. Recording sale of non-cash
assets
d. Closing Gain or loss on
realization
e. Payment of partners loans
f. Payment of partners capital

a.

The corporate Form of Business

Organization

difference lump-sum
liquidation from
installment liquidation
prepare the statement of
liquidation
prepare entries for the sale
of non-cash assets,
payment of liabilities and
distribution of cash to
partners.
prepare the cash priority
program and schedule of
safe payments.

Student must be able to:

1.

Learning Contents

1.

Formation of corporation
a. Definition, attributes
and classes
b. Advantages and
disadvantages
c. Registration
requirements
d. Components of a
corporation

1 Week

Group Activity:
Search the web and look for copies
of Articles of Incorporation and by
Laws of different companies in the
Philippines.

4.

business organization.
Give the different classes
of stocks.

Students must be able to:

1.

2.

Record transactions
involving issuances of par
value ordinary and
preference shares using
the two methods
Record transactions
involving issuances of nopar value ordinary and
preference shares using
the two methods

Students must be able to:

1.

2.

Record the acquisition of

treasury stock using the
generally acceptable
method.
Record the sale and
retirement of treasury
stocks.

Students must be able to:

1.

2.

Close the net income to

the retained earnings
account.
Prepare entries for the
appropriation of retained
earnings.

2.
3.

Components of stockholders
equity
Capital Stock
a. Basic terms
b. Status and classes
c. Value terms
d. Books and records

b.

Accounting for Formation of

Corporation

1.

Recording preference and ordinary

shares using the memorandum and
journal entry methods
a. Par value stock
b. No par value stock
c.

C. Special Problems and Delinquent Shares

1.
2.
3.

Lecture
Problem solving

Quiz
Recitation

1 Week

Lecture
Problem solving

Quiz
Recitation

1 Week

Lecture
Problem solving

Quiz
Recitation

Acquisition of treasury stocks

Sale of treasury stocks
Retirement of treasury

D. The Nature of Retained Earnings Account

1.
2.
3.

1 Week

Closing income summary account

Prior period adjustment
Appropriation

FINAL PERIOD

Learning Objectives
Students must be able to:
1. Compute the amount of cash
dividends distributable to
common stocks and preferred
stocks which are cumulative,
non-cumulative, participating.
2. Prepare entries to record the
distribution of different classes
of dividends.

Students must be able to:

1.

1.

Compare
merchandising
and
manufacturing
activities.
2. Enumerate the elements
of manufacturing costs.
3. Prepare the cost of goods sold
statement
Students must be able to:

2.
3.

Time Allotment

Learning Activities

Learning Assessment

E. Distributions of dividends
1. Cash Dividends
a. Stocks are cumulative, non-participating
b. Stocks
are
non-cumulative,
nonparticipating
c. Socks are cumulative, participating
d. Stocks are cumulative, non-participating
2. Property Dividends
3. Stock Dividends

2 Weeks

Lecture
Problem solving

F. preparation of the Stockholders Equity Section of the

balance Sheet

1 Week

Lecture
Problem solving

Quiz
Recitation

1 Week

Lecture
Problem solving

Quiz
Recitation

2 Weeks

Lecture
Problem solving

Quiz
Recitation

Quiz
Recitation

Prepare the stockholders equity

section of the balance sheet

Students must be able to:

1.

Learning Contents

Cite the objective financial

statements
Classify the three elements of
financial statements
Prepare and interpret he basic
financial statements

Manufacturing Operations
Nature of manufacturing business
Transactions related to manufacturing process
Elements of manufacturing costs.
Preparation of financial statements of a
manufacturing enterprise

Interpreting financial statements using ratio analysis:

1.Evaluating liquidity
a. Current ratio
b. Acid-test ratio
c. Receivable turn over
d. Inventory turn-over
2.Evaluating profitability
a. ROR on net sales
b. ROR on total Assets
c. ROR on Equity
3. Evaluating Cash flow adequacy

4. Evaluating Market ratios

Prepared by:
Maria Cristina M. Santiago
Instructor

Recommending Approval:
Jefferson L. Triguero
Dept. Chair

Approved by:
Miss. Rosario G. Quesada
College Dean