SALES AND PURCHASE OF BUSINESSES (BUSINESS COMBINATION)

 1.0 INTRODUCTION The term “business combination” is used to describe an arrangement where two or more businesses owned are operated as separate entities join together to become a single entity under a single ownership. The implication of this is that the separate businesses will discontinue their ownership and come under a single ownership. Business combination…

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ACCOUNTING FOR DEPRECIATION

1.0 INTRODUCTION In Unit 3, we have learnt about the concept of depreciation and the various methods of providing for it. In this Unit we shall appreciate the accounting treatment for depreciation in the relevant books of accounts and the final accounts. The Unit also discusses causes of depreciation and how to account for fixed…

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INTRODUCTION TO FINANCIAL RATIO ANALYSIS

1.0 INTRODUCTION Financial analysis is clearly the most important criterion for evaluating management performance, in particular, and the enterprise as a whole. The management of an enterprise and its outside suppliers of capital- creditors and investors- would want to undertake financial analysis in order to make rational economic, political or social decisions. This Unit introduces…

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ACCRUALS AND PREPAYMENTS

1.0 INTRODUCTION There are transactions which take place after the books of accounts have been closed and trial balance prepared. In order to give the actual results of the year’s operations and to ensure that the balance sheet gives a true and fair view of the financial position, these transactions need to be adjustably incorporated…

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DEPARTMENTAL ACCOUNTS

1.0 INTRODUCTION Big businesses, more especially those in the distributive activities, usually departmentalize themselves for efficiency and effectiveness of operations. Some may divide themselves into units known as subsidiaries or just branches. This Unit discusses the concept, advantages and principles of departmental accounting. 2.0 OBJECTIVES At the end of this unit, you should be able…

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