Syllabus: Accountancy for Class 12 | Accountancy Class 12 - Commerce PDF Download

 Page 1


 
Accountancy (Code No. 055) 
Class-XII (2023-24)  
 
Theory: 80 Marks          3 Hours 
Project: 20 Marks 
 
Units 
 
Periods Marks 
Part A Accounting for Partnership Firms and Companies 
  
 
Unit 1. Accounting for Partnership Firms 105 36 
 
Unit 2. Accounting for Companies 45 24 
  
150 60 
Part B Financial Statement Analysis   
 
Unit 3. Analysis of Financial Statements 30 12 
 
Unit 4. Cash Flow Statement 20 8 
  
50 20 
Part C Project Work 20 20 
 
Project work will include: 
  
 
Project File 12 Marks 
  
 
Viva Voce 8 Marks 
  
Or 
Part B Computerized Accounting 
  
 
Unit 4. Computerized Accounting 50 20 
Part C Practical Work 20 20 
 
Practical work will include:   
 
Practical File 12 Marks 
  
 
Viva Voce 8 Marks 
  
 
Page 2


 
Accountancy (Code No. 055) 
Class-XII (2023-24)  
 
Theory: 80 Marks          3 Hours 
Project: 20 Marks 
 
Units 
 
Periods Marks 
Part A Accounting for Partnership Firms and Companies 
  
 
Unit 1. Accounting for Partnership Firms 105 36 
 
Unit 2. Accounting for Companies 45 24 
  
150 60 
Part B Financial Statement Analysis   
 
Unit 3. Analysis of Financial Statements 30 12 
 
Unit 4. Cash Flow Statement 20 8 
  
50 20 
Part C Project Work 20 20 
 
Project work will include: 
  
 
Project File 12 Marks 
  
 
Viva Voce 8 Marks 
  
Or 
Part B Computerized Accounting 
  
 
Unit 4. Computerized Accounting 50 20 
Part C Practical Work 20 20 
 
Practical work will include:   
 
Practical File 12 Marks 
  
 
Viva Voce 8 Marks 
  
 
Part A: Accounting for Partnership Firms and Companies 
Unit 1: Accounting for Partnership Firms        
Units/Topics Learning Outcomes 
? Partnership: features, Partnership Deed. 
? Provisions of the Indian Partnership Act 1932 
in the absence of partnership deed. 
? Fixed v/s fluctuating capital accounts. 
Preparation of Profit and Loss Appropriation 
account- division of profit among partners, 
guarantee of profits. 
? Past adjustments (relating to interest on 
capital, interest on drawing, salary and profit 
sharing ratio). 
? Goodwill: meaning, nature, factors affecting 
and methods of valuation - average profit, 
super profit and capitalization. 
 
Note: Interest on partner's loan is to be treated as a 
charge against profits. 
Goodwill: meaning, factors affecting, need for 
valuation, methods for calculation (average profits, 
super profits and capitalization), adjusted through 
partners capital/ current account.  
 
Accounting for Partnership firms - Reconstitution 
and Dissolution. 
? Change in the Profit Sharing Ratio among 
the existing partners - sacrificing ratio, 
gaining ratio, accounting for revaluation of 
assets and reassessment of liabilities and 
treatment of reserves, accumulated profits 
and losses. Preparation of revaluation 
account and balance sheet. 
? Admission of a partner - effect of admission 
of a partner on change in the profit sharing 
ratio, treatment of goodwill (as per AS 26), 
treatment for revaluation of assets and re- 
assessment of liabilities, treatment of 
reserves, accumulated profits and losses, 
After going through this Unit, the students will be 
able to: 
? state the meaning of partnership, partnership 
firm and partnership deed. 
? describe the characteristic features of 
partnership and the contents of partnership 
deed. 
? discuss the significance of provision of 
Partnership Act in the absence of partnership 
deed. 
? differentiate between fixed and fluctuating 
capital, outline the process and develop the 
understanding and skill of preparation of 
Profit and Loss Appropriation Account. 
? develop the understanding and skill of 
preparation profit and loss appropriation 
account involving guarantee of profits. 
? develop the understanding and skill of 
making past adjustments.  
? state the meaning, nature and factors 
affecting goodwill  
? develop the understanding and skill of 
valuation of goodwill using different methods. 
? state the meaning of sacrificing ratio, gaining 
ratio and the change in profit sharing ratio 
among existing partners. 
? develop the understanding of accounting 
treatment of revaluation assets and 
reassessment of liabilities and treatment of 
reserves and accumulated profits by 
preparing revaluation account and balance 
sheet. 
? explain the effect of change in profit sharing 
ratio on admission of a new partner. 
? develop the understanding and skill of 
Page 3


 
Accountancy (Code No. 055) 
Class-XII (2023-24)  
 
Theory: 80 Marks          3 Hours 
Project: 20 Marks 
 
Units 
 
Periods Marks 
Part A Accounting for Partnership Firms and Companies 
  
 
Unit 1. Accounting for Partnership Firms 105 36 
 
Unit 2. Accounting for Companies 45 24 
  
150 60 
Part B Financial Statement Analysis   
 
Unit 3. Analysis of Financial Statements 30 12 
 
Unit 4. Cash Flow Statement 20 8 
  
50 20 
Part C Project Work 20 20 
 
Project work will include: 
  
 
Project File 12 Marks 
  
 
Viva Voce 8 Marks 
  
Or 
Part B Computerized Accounting 
  
 
Unit 4. Computerized Accounting 50 20 
Part C Practical Work 20 20 
 
Practical work will include:   
 
Practical File 12 Marks 
  
 
Viva Voce 8 Marks 
  
 
Part A: Accounting for Partnership Firms and Companies 
Unit 1: Accounting for Partnership Firms        
Units/Topics Learning Outcomes 
? Partnership: features, Partnership Deed. 
? Provisions of the Indian Partnership Act 1932 
in the absence of partnership deed. 
? Fixed v/s fluctuating capital accounts. 
Preparation of Profit and Loss Appropriation 
account- division of profit among partners, 
guarantee of profits. 
? Past adjustments (relating to interest on 
capital, interest on drawing, salary and profit 
sharing ratio). 
? Goodwill: meaning, nature, factors affecting 
and methods of valuation - average profit, 
super profit and capitalization. 
 
Note: Interest on partner's loan is to be treated as a 
charge against profits. 
Goodwill: meaning, factors affecting, need for 
valuation, methods for calculation (average profits, 
super profits and capitalization), adjusted through 
partners capital/ current account.  
 
Accounting for Partnership firms - Reconstitution 
and Dissolution. 
? Change in the Profit Sharing Ratio among 
the existing partners - sacrificing ratio, 
gaining ratio, accounting for revaluation of 
assets and reassessment of liabilities and 
treatment of reserves, accumulated profits 
and losses. Preparation of revaluation 
account and balance sheet. 
? Admission of a partner - effect of admission 
of a partner on change in the profit sharing 
ratio, treatment of goodwill (as per AS 26), 
treatment for revaluation of assets and re- 
assessment of liabilities, treatment of 
reserves, accumulated profits and losses, 
After going through this Unit, the students will be 
able to: 
? state the meaning of partnership, partnership 
firm and partnership deed. 
? describe the characteristic features of 
partnership and the contents of partnership 
deed. 
? discuss the significance of provision of 
Partnership Act in the absence of partnership 
deed. 
? differentiate between fixed and fluctuating 
capital, outline the process and develop the 
understanding and skill of preparation of 
Profit and Loss Appropriation Account. 
? develop the understanding and skill of 
preparation profit and loss appropriation 
account involving guarantee of profits. 
? develop the understanding and skill of 
making past adjustments.  
? state the meaning, nature and factors 
affecting goodwill  
? develop the understanding and skill of 
valuation of goodwill using different methods. 
? state the meaning of sacrificing ratio, gaining 
ratio and the change in profit sharing ratio 
among existing partners. 
? develop the understanding of accounting 
treatment of revaluation assets and 
reassessment of liabilities and treatment of 
reserves and accumulated profits by 
preparing revaluation account and balance 
sheet. 
? explain the effect of change in profit sharing 
ratio on admission of a new partner. 
? develop the understanding and skill of 
adjustment of capital accounts and 
preparation of capital, current account and 
balance sheet.  
? Retirement and death of a partner: effect of 
retirement / death of a partner on change in 
profit sharing ratio, treatment of goodwill (as 
per AS 26), treatment for revaluation of 
assets and reassessment of liabilities, 
adjustment of accumulated profits, losses 
and reserves, adjustment of capital accounts 
and preparation of capital, current account 
and balance sheet. Preparation of loan 
account of the retiring partner.  
? Calculation of deceased partner’s share of 
profit till the date of death. Preparation of 
deceased partner’s capital account and his 
executor’s account. 
? Dissolution of a partnership firm: meaning 
of dissolution of partnership and partnership 
firm, types of dissolution of a firm. Settlement 
of accounts - preparation of realization 
account, and other related accounts: capital 
accounts of partners and cash/bank a/c 
(excluding piecemeal distribution, sale to a 
company and insolvency of partner(s)). 
Note: 
(i) If the realized value of tangible assets is not given it 
should be considered as realized at book value itself. 
(ii) If the realized value of intangible assets is not 
given it should be considered as nil (zero value). 
(ii) In case, the realization expenses are borne by a 
partner, clear indication should be given regarding the 
payment thereof. 
treatment of goodwill as per AS-26, treatment 
of revaluation of assets and re-assessment of 
liabilities, treatment of reserves and 
accumulated profits, adjustment of capital 
accounts and preparation of capital, current 
account and balance sheet of the new firm. 
? explain the effect of retirement / death of a 
partner on change in profit sharing ratio. 
? develop the understanding of accounting 
treatment of goodwill, revaluation of assets 
and re-assessment of liabilities and 
adjustment of accumulated profits, losses 
and reserves on retirement / death of a 
partner and capital adjustment. 
? develop the skill of calculation of deceased 
partner's share till the time of his death and 
prepare deceased partner's and executor's 
account. 
? discuss the preparation of the capital 
accounts of the remaining partners and the 
balance sheet of the firm after retirement / 
death of a partner. 
? understand the situations under which a 
partnership firm can be dissolved. 
? develop the understanding of preparation of 
realisation account and other related 
accounts. 
 
Unit-3 Accounting for Companies         
 
Units/Topics Learning Outcomes 
Accounting for Share Capital 
? Features and types of companies. 
? Share and share capital: nature and types. 
After going through this Unit, the students will be 
able to: 
? state the meaning of share and share capital 
Page 4


 
Accountancy (Code No. 055) 
Class-XII (2023-24)  
 
Theory: 80 Marks          3 Hours 
Project: 20 Marks 
 
Units 
 
Periods Marks 
Part A Accounting for Partnership Firms and Companies 
  
 
Unit 1. Accounting for Partnership Firms 105 36 
 
Unit 2. Accounting for Companies 45 24 
  
150 60 
Part B Financial Statement Analysis   
 
Unit 3. Analysis of Financial Statements 30 12 
 
Unit 4. Cash Flow Statement 20 8 
  
50 20 
Part C Project Work 20 20 
 
Project work will include: 
  
 
Project File 12 Marks 
  
 
Viva Voce 8 Marks 
  
Or 
Part B Computerized Accounting 
  
 
Unit 4. Computerized Accounting 50 20 
Part C Practical Work 20 20 
 
Practical work will include:   
 
Practical File 12 Marks 
  
 
Viva Voce 8 Marks 
  
 
Part A: Accounting for Partnership Firms and Companies 
Unit 1: Accounting for Partnership Firms        
Units/Topics Learning Outcomes 
? Partnership: features, Partnership Deed. 
? Provisions of the Indian Partnership Act 1932 
in the absence of partnership deed. 
? Fixed v/s fluctuating capital accounts. 
Preparation of Profit and Loss Appropriation 
account- division of profit among partners, 
guarantee of profits. 
? Past adjustments (relating to interest on 
capital, interest on drawing, salary and profit 
sharing ratio). 
? Goodwill: meaning, nature, factors affecting 
and methods of valuation - average profit, 
super profit and capitalization. 
 
Note: Interest on partner's loan is to be treated as a 
charge against profits. 
Goodwill: meaning, factors affecting, need for 
valuation, methods for calculation (average profits, 
super profits and capitalization), adjusted through 
partners capital/ current account.  
 
Accounting for Partnership firms - Reconstitution 
and Dissolution. 
? Change in the Profit Sharing Ratio among 
the existing partners - sacrificing ratio, 
gaining ratio, accounting for revaluation of 
assets and reassessment of liabilities and 
treatment of reserves, accumulated profits 
and losses. Preparation of revaluation 
account and balance sheet. 
? Admission of a partner - effect of admission 
of a partner on change in the profit sharing 
ratio, treatment of goodwill (as per AS 26), 
treatment for revaluation of assets and re- 
assessment of liabilities, treatment of 
reserves, accumulated profits and losses, 
After going through this Unit, the students will be 
able to: 
? state the meaning of partnership, partnership 
firm and partnership deed. 
? describe the characteristic features of 
partnership and the contents of partnership 
deed. 
? discuss the significance of provision of 
Partnership Act in the absence of partnership 
deed. 
? differentiate between fixed and fluctuating 
capital, outline the process and develop the 
understanding and skill of preparation of 
Profit and Loss Appropriation Account. 
? develop the understanding and skill of 
preparation profit and loss appropriation 
account involving guarantee of profits. 
? develop the understanding and skill of 
making past adjustments.  
? state the meaning, nature and factors 
affecting goodwill  
? develop the understanding and skill of 
valuation of goodwill using different methods. 
? state the meaning of sacrificing ratio, gaining 
ratio and the change in profit sharing ratio 
among existing partners. 
? develop the understanding of accounting 
treatment of revaluation assets and 
reassessment of liabilities and treatment of 
reserves and accumulated profits by 
preparing revaluation account and balance 
sheet. 
? explain the effect of change in profit sharing 
ratio on admission of a new partner. 
? develop the understanding and skill of 
adjustment of capital accounts and 
preparation of capital, current account and 
balance sheet.  
? Retirement and death of a partner: effect of 
retirement / death of a partner on change in 
profit sharing ratio, treatment of goodwill (as 
per AS 26), treatment for revaluation of 
assets and reassessment of liabilities, 
adjustment of accumulated profits, losses 
and reserves, adjustment of capital accounts 
and preparation of capital, current account 
and balance sheet. Preparation of loan 
account of the retiring partner.  
? Calculation of deceased partner’s share of 
profit till the date of death. Preparation of 
deceased partner’s capital account and his 
executor’s account. 
? Dissolution of a partnership firm: meaning 
of dissolution of partnership and partnership 
firm, types of dissolution of a firm. Settlement 
of accounts - preparation of realization 
account, and other related accounts: capital 
accounts of partners and cash/bank a/c 
(excluding piecemeal distribution, sale to a 
company and insolvency of partner(s)). 
Note: 
(i) If the realized value of tangible assets is not given it 
should be considered as realized at book value itself. 
(ii) If the realized value of intangible assets is not 
given it should be considered as nil (zero value). 
(ii) In case, the realization expenses are borne by a 
partner, clear indication should be given regarding the 
payment thereof. 
treatment of goodwill as per AS-26, treatment 
of revaluation of assets and re-assessment of 
liabilities, treatment of reserves and 
accumulated profits, adjustment of capital 
accounts and preparation of capital, current 
account and balance sheet of the new firm. 
? explain the effect of retirement / death of a 
partner on change in profit sharing ratio. 
? develop the understanding of accounting 
treatment of goodwill, revaluation of assets 
and re-assessment of liabilities and 
adjustment of accumulated profits, losses 
and reserves on retirement / death of a 
partner and capital adjustment. 
? develop the skill of calculation of deceased 
partner's share till the time of his death and 
prepare deceased partner's and executor's 
account. 
? discuss the preparation of the capital 
accounts of the remaining partners and the 
balance sheet of the firm after retirement / 
death of a partner. 
? understand the situations under which a 
partnership firm can be dissolved. 
? develop the understanding of preparation of 
realisation account and other related 
accounts. 
 
Unit-3 Accounting for Companies         
 
Units/Topics Learning Outcomes 
Accounting for Share Capital 
? Features and types of companies. 
? Share and share capital: nature and types. 
After going through this Unit, the students will be 
able to: 
? state the meaning of share and share capital 
? Accounting for share capital: issue and 
allotment of equity and preferences shares. 
Public subscription of shares - over 
subscription and under subscription of 
shares; issue at par and at premium, calls in 
advance and arrears (excluding interest), 
issue of shares for consideration other than 
cash. 
? Concept of Private Placement and Employee 
Stock Option Plan (ESOP), Sweat Equity. 
? Accounting treatment of forfeiture and re-
issue of shares. 
? Disclosure of share capital in the Balance 
Sheet of a company. 
 
Accounting for Debentures 
? Debentures: Meaning, types, Issue of 
debentures at par, at a premium and at a 
discount. Issue of debentures for 
consideration other than cash; Issue of 
debentures with terms of redemption; 
debentures as collateral security-concept, 
interest on debentures (concept of TDS is 
excluded). Writing off discount / loss on issue 
of debentures. 
Note: Discount or loss on issue of debentures to be 
written off in the year debentures are allotted from 
Security Premium Reserve (if it exists) and then from 
Statement of Profit and Loss as Financial Cost (AS 
16) 
and differentiate between equity shares and 
preference shares and different types of 
share capital. 
? understand the meaning of private placement 
of shares and Employee Stock Option Plan. 
? explain the accounting treatment of share 
capital transactions regarding issue of 
shares. 
? develop the understanding of accounting 
treatment of forfeiture and re-issue of 
forfeited shares. 
? describe the presentation of share capital in 
the balance sheet of the company as per 
schedule III part I of the Companies Act 
2013. 
? explain the accounting treatment of different 
categories of transactions related to issue of 
debentures. 
? develop the understanding and skill of writing 
of discount / loss on issue of debentures. 
? understand the concept of collateral security 
and its presentation in balance sheet. 
? develop the skill of calculating interest on 
debentures and its accounting treatment. 
? state the meaning of redemption of 
debentures. 
 
 
 
Part B: Financial Statement Analysis        
 
Unit 4: Analysis of Financial Statements  
Units/Topics Learning Outcomes 
Financial statements of a Company:  
Meaning, Nature, Uses and importance of financial 
Statement. 
Statement of Profit and Loss and Balance Sheet in 
After going through this Unit, the students will be 
able to: 
? develop the understanding of major headings 
and sub-headings (as per Schedule III to the 
Page 5


 
Accountancy (Code No. 055) 
Class-XII (2023-24)  
 
Theory: 80 Marks          3 Hours 
Project: 20 Marks 
 
Units 
 
Periods Marks 
Part A Accounting for Partnership Firms and Companies 
  
 
Unit 1. Accounting for Partnership Firms 105 36 
 
Unit 2. Accounting for Companies 45 24 
  
150 60 
Part B Financial Statement Analysis   
 
Unit 3. Analysis of Financial Statements 30 12 
 
Unit 4. Cash Flow Statement 20 8 
  
50 20 
Part C Project Work 20 20 
 
Project work will include: 
  
 
Project File 12 Marks 
  
 
Viva Voce 8 Marks 
  
Or 
Part B Computerized Accounting 
  
 
Unit 4. Computerized Accounting 50 20 
Part C Practical Work 20 20 
 
Practical work will include:   
 
Practical File 12 Marks 
  
 
Viva Voce 8 Marks 
  
 
Part A: Accounting for Partnership Firms and Companies 
Unit 1: Accounting for Partnership Firms        
Units/Topics Learning Outcomes 
? Partnership: features, Partnership Deed. 
? Provisions of the Indian Partnership Act 1932 
in the absence of partnership deed. 
? Fixed v/s fluctuating capital accounts. 
Preparation of Profit and Loss Appropriation 
account- division of profit among partners, 
guarantee of profits. 
? Past adjustments (relating to interest on 
capital, interest on drawing, salary and profit 
sharing ratio). 
? Goodwill: meaning, nature, factors affecting 
and methods of valuation - average profit, 
super profit and capitalization. 
 
Note: Interest on partner's loan is to be treated as a 
charge against profits. 
Goodwill: meaning, factors affecting, need for 
valuation, methods for calculation (average profits, 
super profits and capitalization), adjusted through 
partners capital/ current account.  
 
Accounting for Partnership firms - Reconstitution 
and Dissolution. 
? Change in the Profit Sharing Ratio among 
the existing partners - sacrificing ratio, 
gaining ratio, accounting for revaluation of 
assets and reassessment of liabilities and 
treatment of reserves, accumulated profits 
and losses. Preparation of revaluation 
account and balance sheet. 
? Admission of a partner - effect of admission 
of a partner on change in the profit sharing 
ratio, treatment of goodwill (as per AS 26), 
treatment for revaluation of assets and re- 
assessment of liabilities, treatment of 
reserves, accumulated profits and losses, 
After going through this Unit, the students will be 
able to: 
? state the meaning of partnership, partnership 
firm and partnership deed. 
? describe the characteristic features of 
partnership and the contents of partnership 
deed. 
? discuss the significance of provision of 
Partnership Act in the absence of partnership 
deed. 
? differentiate between fixed and fluctuating 
capital, outline the process and develop the 
understanding and skill of preparation of 
Profit and Loss Appropriation Account. 
? develop the understanding and skill of 
preparation profit and loss appropriation 
account involving guarantee of profits. 
? develop the understanding and skill of 
making past adjustments.  
? state the meaning, nature and factors 
affecting goodwill  
? develop the understanding and skill of 
valuation of goodwill using different methods. 
? state the meaning of sacrificing ratio, gaining 
ratio and the change in profit sharing ratio 
among existing partners. 
? develop the understanding of accounting 
treatment of revaluation assets and 
reassessment of liabilities and treatment of 
reserves and accumulated profits by 
preparing revaluation account and balance 
sheet. 
? explain the effect of change in profit sharing 
ratio on admission of a new partner. 
? develop the understanding and skill of 
adjustment of capital accounts and 
preparation of capital, current account and 
balance sheet.  
? Retirement and death of a partner: effect of 
retirement / death of a partner on change in 
profit sharing ratio, treatment of goodwill (as 
per AS 26), treatment for revaluation of 
assets and reassessment of liabilities, 
adjustment of accumulated profits, losses 
and reserves, adjustment of capital accounts 
and preparation of capital, current account 
and balance sheet. Preparation of loan 
account of the retiring partner.  
? Calculation of deceased partner’s share of 
profit till the date of death. Preparation of 
deceased partner’s capital account and his 
executor’s account. 
? Dissolution of a partnership firm: meaning 
of dissolution of partnership and partnership 
firm, types of dissolution of a firm. Settlement 
of accounts - preparation of realization 
account, and other related accounts: capital 
accounts of partners and cash/bank a/c 
(excluding piecemeal distribution, sale to a 
company and insolvency of partner(s)). 
Note: 
(i) If the realized value of tangible assets is not given it 
should be considered as realized at book value itself. 
(ii) If the realized value of intangible assets is not 
given it should be considered as nil (zero value). 
(ii) In case, the realization expenses are borne by a 
partner, clear indication should be given regarding the 
payment thereof. 
treatment of goodwill as per AS-26, treatment 
of revaluation of assets and re-assessment of 
liabilities, treatment of reserves and 
accumulated profits, adjustment of capital 
accounts and preparation of capital, current 
account and balance sheet of the new firm. 
? explain the effect of retirement / death of a 
partner on change in profit sharing ratio. 
? develop the understanding of accounting 
treatment of goodwill, revaluation of assets 
and re-assessment of liabilities and 
adjustment of accumulated profits, losses 
and reserves on retirement / death of a 
partner and capital adjustment. 
? develop the skill of calculation of deceased 
partner's share till the time of his death and 
prepare deceased partner's and executor's 
account. 
? discuss the preparation of the capital 
accounts of the remaining partners and the 
balance sheet of the firm after retirement / 
death of a partner. 
? understand the situations under which a 
partnership firm can be dissolved. 
? develop the understanding of preparation of 
realisation account and other related 
accounts. 
 
Unit-3 Accounting for Companies         
 
Units/Topics Learning Outcomes 
Accounting for Share Capital 
? Features and types of companies. 
? Share and share capital: nature and types. 
After going through this Unit, the students will be 
able to: 
? state the meaning of share and share capital 
? Accounting for share capital: issue and 
allotment of equity and preferences shares. 
Public subscription of shares - over 
subscription and under subscription of 
shares; issue at par and at premium, calls in 
advance and arrears (excluding interest), 
issue of shares for consideration other than 
cash. 
? Concept of Private Placement and Employee 
Stock Option Plan (ESOP), Sweat Equity. 
? Accounting treatment of forfeiture and re-
issue of shares. 
? Disclosure of share capital in the Balance 
Sheet of a company. 
 
Accounting for Debentures 
? Debentures: Meaning, types, Issue of 
debentures at par, at a premium and at a 
discount. Issue of debentures for 
consideration other than cash; Issue of 
debentures with terms of redemption; 
debentures as collateral security-concept, 
interest on debentures (concept of TDS is 
excluded). Writing off discount / loss on issue 
of debentures. 
Note: Discount or loss on issue of debentures to be 
written off in the year debentures are allotted from 
Security Premium Reserve (if it exists) and then from 
Statement of Profit and Loss as Financial Cost (AS 
16) 
and differentiate between equity shares and 
preference shares and different types of 
share capital. 
? understand the meaning of private placement 
of shares and Employee Stock Option Plan. 
? explain the accounting treatment of share 
capital transactions regarding issue of 
shares. 
? develop the understanding of accounting 
treatment of forfeiture and re-issue of 
forfeited shares. 
? describe the presentation of share capital in 
the balance sheet of the company as per 
schedule III part I of the Companies Act 
2013. 
? explain the accounting treatment of different 
categories of transactions related to issue of 
debentures. 
? develop the understanding and skill of writing 
of discount / loss on issue of debentures. 
? understand the concept of collateral security 
and its presentation in balance sheet. 
? develop the skill of calculating interest on 
debentures and its accounting treatment. 
? state the meaning of redemption of 
debentures. 
 
 
 
Part B: Financial Statement Analysis        
 
Unit 4: Analysis of Financial Statements  
Units/Topics Learning Outcomes 
Financial statements of a Company:  
Meaning, Nature, Uses and importance of financial 
Statement. 
Statement of Profit and Loss and Balance Sheet in 
After going through this Unit, the students will be 
able to: 
? develop the understanding of major headings 
and sub-headings (as per Schedule III to the 
prescribed form with major headings and sub 
headings (as per Schedule III to the Companies Act, 
2013) 
 
Note: Exceptional items, extraordinary items and 
profit (loss) from discontinued operations are 
excluded. 
? Financial Statement Analysis: Meaning, 
Significance Objectives, importance and 
limitations. 
? Tools for Financial Statement Analysis: 
Comparative statements, common size 
statements, Ratio analysis, Cash flow 
analysis.  
? Accounting Ratios: Meaning, Objectives, 
Advantages, classification and computation. 
? Liquidity Ratios: Current ratio and Quick 
ratio. 
? Solvency Ratios: Debt to Equity Ratio, Total 
Asset to Debt Ratio, Proprietary Ratio and 
Interest Coverage Ratio. Debt to Capital 
Employed Ratio. 
? Activity Ratios: Inventory Turnover Ratio, 
Trade Receivables Turnover Ratio, Trade 
Payables Turnover Ratio, Fixed Asset 
Turnover Ratio, Net Asset Turnover Ratio 
and Working Capital Turnover Ratio. 
? Profitability Ratios: Gross Profit Ratio, 
Operating Ratio, Operating Profit Ratio, Net 
Profit Ratio and Return on Investment. 
Companies Act, 2013) of balance sheet as 
per the prescribed norms / formats. 
? state the meaning, objectives and limitations 
of financial statement analysis. 
? discuss the meaning of different tools of 
'financial statements analysis'. 
? develop the skill of preparation of preparation 
of comparative and common size statement, 
understand their uses and difference 
between the two.  
? state the meaning, objectives and 
significance of different types of ratios. 
? develop the understanding of computation of 
current ratio and quick ratio. 
? develop the skill of computation of debt equity 
ratio, total asset to debt ratio, proprietary ratio 
and interest coverage ratio. 
? develop the skill of computation of inventory 
turnover ratio, trade receivables and trade 
payables ratio and working capital turnover 
ratio and others. 
? develop the skill of computation of gross 
profit ratio, operating ratio, operating profit 
ratio, net profit ratio and return on investment. 
 
Note: Net Profit Ratio is to be calculated on the basis of profit before and after tax. 
 
Unit 5: Cash Flow Statement          
 
Units/Topics Learning Outcomes 
? Meaning, objectives Benefits, Cash and Cash 
Equivalents, Classification of Activities and 
preparation (as per AS 3 (Revised) (Indirect 
Method only) 
After going through this Unit, the students will 
be able to: 
? state the meaning and objectives of cash flow 
statement.