Learning
Accounting

Accounting Units 1 - 4

Why Study Accounting?

Accounting is the process of recording, reporting, analysing and interpreting financial data and accounting information which is then communicated to internal and external users of this information. It plays an integral role in the successful operation and management of businesses. VCE Accounting focuses on small business. Unit 1 begins with a small service business, allowing students to develop knowledge and skills in accounting without the complexities of accounting for trading businesses or large organisations. Units 2, 3 and 4 then focus on a single activity trading business where students build on and extend their accounting skills Many students who study VCE Accounting will go on to further studies and careers in business and finance.

Structure

The study is made up of four units:

Unit 1: Establishing and operating a service business
Unit 2: Accounting for a trading business
Unit 3: Recording and reporting for a trading business
Unit 4: Control and analysis of business performance

All units focus on accounting and finance for a sole-proprietor small business. It is expected that students will use ICT in accounting procedures in all units.

Outcomes  

Outcomes define what students will know and be able to do as a result of undertaking the study. Outcomes include a summary statement and the key knowledge and skills that underpin them.  

Unit 1: Establishing and operating a service business  

This unit focuses on the establishment of a small business and the accounting and financial management of the business. Students are introduced to the processes of gathering and recording financial data and the reporting and analysing of accounting information by internal and external users. The cash basis of recording and reporting is used throughout this unit.

Using single entry recording of financial data and analysis of accounting information, students examine the role of accounting in the decision-making process for a sole proprietor of a service business.  

Outcome 1
On completion of this unit the student should be able to describe the resources required, and
explain and discuss the knowledge and skills necessary, to set up a small business.  

Outcome 2
On completion of this unit the student should be able to identify and record the financial data, and report and explain accounting information, for a sole proprietor of a service business.  

Unit 2: Accounting for a trading business

This unit extends the accounting process from a service business and focuses on accounting for a sole proprietor of a single activity trading business. Students use a single entry recording system for cash and credit transactions and the accrual method for determining profit. They analyse and evaluate the performance of the business using financial and non-financial information. Using these evaluations, students suggest strategies to the owner on how to improve the performance of the business.

Students develop their understanding of the importance of ICT in the accounting process by using a commercial accounting software package to establish a set of accounts, record financial transactions and generate accounting reports.  

Outcome 1
On completion of this unit the student should be able to record financial data and report accounting information for a sole trader.  

Outcome 2
On completion of this unit the student should be able to record financial data and report accounting information for a single activity sole trader using a commercial accounting software package, and discuss the use of ICT in the accounting process.

Outcome 3
On completion of this unit the student should be able to select and use financial and non-financial information to evaluate the performance of a business and discuss strategies that may improve business performance.

Unit 3: Recording and reporting for a trading business

This unit focuses on financial accounting for a single activity trading business as operated by a sole trader and emphasises the role of accounting as an information system. Students use the double entry system of recording financial data and prepare reports using the accrual basis of accounting. The perpetual method of stock recording with the First In, First Out (FIFO) method is used.

Outcome 1
On completion of this unit the student should be able to record financial data for a single activity sole trader using a double entry system, and discuss the function of various aspects of this accounting system.  

Outcome 2
On completion of this unit the student should be able to record balance day adjustments and prepare and interpret accounting reports.

Unit 4: Control and analysis of business performance

This unit provides an extension of the recording and reporting processes from Unit 3 and the use
of financial and non-financial information in assisting management in the decision-making process. The unit is based on the double entry accounting system and the accrual method of reporting for a single activity trading business using the perpetual inventory recording system.

Students investigate the role and importance of budgeting for the business and undertake the practical completion of budgets fro cash, profit and financial position. Students interpret
accounting information from accounting reports and graphical representations, and analyse the results to suggest strategies to the owner on how to improve the performance of the business.

Outcome 1
On completion of this unit the student should be able to record financial data using double entry accounting and report accounting information using an accrual-based system for a single activity sole trader, and discuss the function of various aspects of this accounting system.

Outcome 2
On completion of this unit the student should be able to prepare budgets and variance reports, evaluate the performance of a business using financial and non-financial information and discuss strategies to improve the profitability and liquidity of the business.


Assessment

Satisfactory Completion

The award of satisfactory completion for a unit is based on a decision that the student has demonstrated achievement of the set of outcomes specified for the unit. This decision will be based on the teacher’s assessment of the student’s performance on assessment tasks designated for the unit.

Levels of Achievement

Units 1 and 2

Emmaus College students complete graded Assessment Tasks and Semester Examinations as part of the Assessment process for Units 1 and 2.

Units 3 and 4

The Victorian Curriculum and Assessment Authority will supervise the assessment of all students undertaking Units 3 and 4. In the study of VCE Accounting students’ level of achievement will be determined in Unit 3 by School-assessed Coursework and in Unit 4 by School-assessed Coursework and an end-of-year examination.

Percentage contributions to the study score in VCE Accounting are as follows:

Unit 3 School-assessed Coursework 25%
Unit 4 School-assessed Coursework 25%
End-of-year examination 50%