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close this book Accounting for the microbusiness a teaching manual - A Handbook for Volunteers
close this folder The system
View the document The preliminary interview
View the document Lesson # 1
View the document Lesson # 2
View the document Lesson # 3
View the document Lesson # 4
View the document Installation of the system
View the document Follow-up visits
View the document Month end financial statements
View the document Analysis

Lesson # 1



To explain:

a) The reasons for accounting

b) Balance Sheet. Profit and Loss Statement, and the Trial Balance.


Bulletin Board Aids: 2, 3, 4, 5, 6, 7, 8

Handout Aids: 3, 6, 8 9


The following is a detailed outline presenting the oral lesson:


Aid 2. What is the object of Accounting ? Discussion.


1.1 "The object of accounting is to collect the transactions, to organize and register them and to present them in a way that facilitates analysis "


1.2 "The presentation that facilitates analysis takes the form of the Balance Sheet and the Profit and Loss Statements.'


Aid 3. What is the Balance Statement ? Discussion


2.1 "The Balance Statement represents the financial condition of a company in $ on a particular day. "


2.2 Explain every account especially cash on hand, inventory, investments, fixed assets, current liabilities and capital. For example: "Investments are funds of the company invested outside the business. "


2.3 Aids 4, 5. Explain: Assets - Liabilities = Capital.

Assets = What the company has

Liabilities = What the company owes,

Capital = What remains after paying deb or your investment in the company.


Aid 6. What is a Profit and Loss Statement ? Discussion.


3.1 It is the application of costs to sales during a given period of time to determine profitability.


3.2 Aid 7. Explain each account. Concentrate on Cost of Goods Sold.


Aid 8. What is a Trial Balance ?


4.1 "It is an organizational tool comprised of all the company's accounts taken from both the Balance and Income Statements It is proof that all transactions have been properly recorded.


4.2 Do not explain it further as it will only confuse the student.


Aid 9. Hand out the "Initiation Sheet".


5.1 It is the information needed to start an accounting system.


5.2 Assign the "Fixed Assets List and Values" for the next class.