Accounting Foundations Course

Lesson 1 • What Accounting Is and Why It Matters

Defines accounting as an information system that measures and communicates financial activity. Anchors the chapter by showing how accounting serves owners, managers, and external stakeholders.

Lesson 2 • The Accounting Equation

Introduces Assets = Liabilities + Equity as the structural foundation of all accounting records. Every subsequent topic in the course depends on this relationship.

Lesson 3 • The Business Entity and Its Financial Cycle

Explains how business structure affects accounting and introduces the recurring accounting cycle. Students map the flow from transactions to financial statements.

Lesson 4 • Types of Accounting and Their Purposes

Distinguishes financial, managerial, tax, and cost accounting by audience and objective. Students identify which type applies to a given business scenario.

Lesson 1 • The Trial Balance

Prepares a trial balance to verify that total debits equal total credits before financial statements. Students identify and correct common posting errors using the trial balance.

Lesson 2 • The Chart of Accounts

Explains how accounts are organised and numbered within a business's recordkeeping system. Students design a simple chart of accounts for a small business.

Lesson 3 • Debits, Credits, and the T-Account

Establishes the rules for debits and credits across all account types. Students use T-accounts to visualise how balances increase and decrease.

Lesson 4 • Posting to the General Ledger

Transfers journal entries to ledger accounts and maintains running balances. Students trace a transaction from source document through journal to ledger.

Lesson 1 • Accruals: Revenues and Expenses Earned or Incurred

Records revenues earned but not yet billed and expenses incurred but not yet paid. Students distinguish accrued salaries, interest, and receivables from deferrals.

Lesson 2 • Depreciation of Long-Term Assets

Introduces depreciation as the systematic allocation of an asset's cost over its useful life. Students calculate and record straight-line and units-of-production depreciation.

Lesson 3 • Preparing the Adjusted Trial Balance

Combines unadjusted balances with all adjusting entries to produce the adjusted trial balance. Students verify accuracy and use the adjusted trial balance as the basis for financial statements.

Lesson 4 • Cash Basis vs. Accrual Basis Accounting

Contrasts when transactions are recognised under each method and explains why accrual basis is standard. Students convert simple cash-basis records to accrual basis.

Lesson 1 • Closing Entries and the Post-Closing Trial Balance

Resets temporary accounts to zero and transfers net income to equity to begin the next period. Students complete the full accounting cycle by preparing the post-closing trial balance.

Lesson 2 • The Balance Sheet

Presents assets, liabilities, and equity at a specific date in classified format. Students verify that the balance sheet balances and interpret the liquidity of current vs. long-term items.

Lesson 3 • Interpreting Financial Statements

Develops the ability to read and question what financial statements reveal about business health. Students identify red flags and strengths using basic ratio comparisons.

Lesson 4 • The Income Statement

Builds a multi-step income statement showing revenues, cost of goods sold, gross profit, and net income. Students analyse how operating and non-operating items affect profitability.

Lesson 1 • Recording Sales of Inventory

Records revenue and the corresponding cost of goods sold entry for each sale. Students handle sales returns, allowances, and cash discounts offered to customers.

Lesson 2 • Recording Purchases of Inventory

Covers purchase transactions including freight, returns, and early-payment discounts under both inventory systems. Students record net and gross methods for purchase discounts.

Lesson 3 • Inventory Valuation and Adjustments

Applies the lower-of-cost-or-net-realizable-value rule and records inventory write-downs. Students also estimate inventory using the gross profit and retail methods.

Lesson 4 • Inventory Costing Methods

Compares FIFO, LIFO, and weighted-average methods for assigning costs to inventory and cost of goods sold. Students calculate ending inventory and gross profit under each method.

Lesson 1 • Notes Receivable and Interest

Distinguishes notes receivable from accounts receivable and calculates interest earned. Students record issuance, accrual, collection, and dishonor of notes.

Lesson 2 • Internal Controls Over Cash

Explains control principles that safeguard cash from error and fraud. Students evaluate a business's cash controls and identify weaknesses.

Lesson 3 • Bank Reconciliation

Reconciles the company's cash book balance to the bank statement balance to detect errors and timing differences. Students prepare a complete bank reconciliation and record adjusting entries.

Lesson 4 • Short-Term Investments and Prepaid Assets

Covers classification and measurement of short-term investments and prepaid costs on the balance sheet. Students record purchases, adjustments, and disposals of these assets.

Lesson 1 • Disposing of Plant Assets

Records retirement, sale, and exchange of plant assets and calculates gain or loss on disposal. Students update accumulated depreciation before recording any disposal.

Lesson 2 • Acquiring and Depreciating Long-Term Assets

Records the full cost of acquiring plant assets and applies multiple depreciation methods over their useful lives. Students choose the appropriate method based on asset usage patterns.

Lesson 3 • Corporate Equity Transactions

Records issuance of common and preferred stock, treasury stock purchases, and cash dividends. Students prepare the stockholders' equity section of a corporate balance sheet.

Lesson 4 • Intangible Assets and Natural Resources

Covers amortisation of intangibles such as patents and trademarks and depletion of natural resources. Students distinguish finite-life from indefinite-life intangibles and apply impairment testing.

Lesson 1 • Purpose and Structure of the Cash Flow Statement

Explains why cash flow information supplements accrual-based statements and defines the three activity sections. Students classify transactions as operating, investing, or financing.

Lesson 2 • Liquidity and Solvency Ratios

Calculates current ratio, quick ratio, debt-to-equity, and interest coverage to assess short- and long-term financial health. Students benchmark ratios against industry norms.

Lesson 3 • Indirect Method for Operating Activities

Reconciles net income to net cash from operations by adjusting for non-cash items and working capital changes. Students prepare the operating section using the indirect method.

Lesson 4 • Direct Method and Investing and Financing Sections

Presents cash receipts and payments directly for the operating section and records all investing and financing flows. Students compare direct and indirect methods and complete a full statement.