Summary of Unit 1
Dear students, Now that the first tutorial is over, I hope you are getting gear-up to start your semester! As usual, many students may feel that 2 hours are not enough for tutors to go through everything. There are two important points here that I want to stress on: - Accounting concepts build on each other. So, it's essential that you master the concepts right from the beginning. Besides, please read up the course materials or at least go through the slides before each tutorial. - Studying accounting is not as hard as you may think, but practice is important. We strongly encourage you to try out all the exercises in your course materials and also the relevant questions in your textbook. Practice, practice and practice....Doing the questions and exercises is very important. Don't panic that in the beginning you may not get all the numbers and all the accounts correctly or you may find that your balance sheet does not balance. The more examples you study, the more exercises you do, you will have a better picture So, here's a summary of the important concepts that you should know from Unit 1. Hope this will help you to enhance your understanding of the Unit. There are 5 main sections in Unit 1 that you have to know. Introduction: - There are 3 types of business – merchandising, manufacturing and service. i. Merchandising = buy products from supplier and then sell it to customers. E.g. a supermarket. ii. Manufacturing = produce the products by going through a series of production processes. E.g. a furniture factory. iii. Service = provide service (not physical product) to customers. E.g. a hair saloon) - There are 3 forms of organizations – Sole proprietorship, Partnership and Corporation. i. Sole proprietorship – only 1 owner, the owner is responsible for all business losses and profits. E.g. Kedai Runcit Ahmad owned by En. Ahmad. ii. Partnership – 2 – 20 owners/partners, the partners are responsible based on their percentage of contribution of...