ZIMSEC O-Level Principles of Accounting

Introduction to Principles of Accounting

Form 1: accounting terms, types of business activity and organisation, the importance of accounting and its users.

The Accounting Cycle

Form 1: transactions, source documents, subsidiary books, ledger, trial balance and financial statements.

Data Processing Methods: Manual and Electronic

Forms 1 and 3: manual and electronic methods of processing accounting data.

Source Documents

Form 1: receipts, cheques, invoices, debit notes, credit notes, vouchers, bank statements and statements of account.

Subsidiary Books

Forms 1 to 3: the books of original entry.

• 5.1 Cash books
• 5.2 Sales, purchases and returns journals
• 5.3 Petty cash book
• 5.4 General journal

The Ledger

Forms 1 to 3: classification, posting and balancing of ledger accounts, folio numbers and the types of ledger.

Trial Balance and Errors

Forms 1 to 4: preparing a trial balance, errors, the suspense account and the effect of errors on profit.

• 7.1 The trial balance
• 7.2 Errors not revealed by the trial balance
• 7.3 Correction of errors and the suspense account
• 7.4 Effect of errors on profit

Accounting Concepts

Form 3 (scope and sequence): matching/accrual, prudence, going concern, consistency, historical cost and double entry.

End of Year Financial Statements

Forms 2 and 3: the income statement and statement of financial position, closing entries and the interpretation of financial statements.

• 9.1 Income statement
• 9.2 Statement of financial position
• 9.3 Closing entries
• 9.4 Interpretation of financial statements

End of Year Adjustments

Forms 2 and 3: accruals and prepayments, depreciation and disposals, provisions, and financial statements with adjustments.

• 10.1 Accruals and prepayments
• 10.2 Depreciation and disposal of non-current assets
• 10.3 Provisions for doubtful debts and discounts allowable
• 10.4 Income statement and statement of financial position with adjustments

Capital and Revenue Expenditure

Form 2: definitions and differences. Form 3: accounting treatment and the effects of incorrect classification.

Control Accounts

Form 3: purposes, types, sources of information and preparation.

Bank Reconciliation

Form 2: bank reconciliation statements. Form 3: errors, the updated cash book and bank overdrafts.

Accounting Ratios

Form 4: profitability ratios (mark-up, margin, net profit percentage) and liquidity ratios (current ratio, quick ratio, rate of inventory turnover).

Single Entry and Incomplete Records

Form 4: statements of affairs, missing figures and financial statements.

Not for Profit Making Organisations (Non-Trading Concerns)

Form 2: key terms, receipts and payments accounts, income and expenditure accounts and statements of financial position. Form 4: sources of income…

Departmental Accounts

Form 3: departmental trading accounts, apportionment of expenses and the combined profit and loss account.

Manufacturing Accounts

Form 4: direct and indirect costs, prime cost, work in progress, income statements and statements of financial position.

Partnership Formation: End of Year Financial Statements

Form 4: formation, advantages and disadvantages, income statements, appropriation accounts, capital and current accounts and statements of financial position.

Company Accounts

Form 4: terms (shares, debentures, share capital, shareholders' funds, dividends, reserves, retained profits), statements of changes in equity and statements…

Business Ethics

Form 4: professionalism, integrity, confidentiality, competence, objectivity and compliance.