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Level 1: Business Finance

Module Description

This module aims to:

1. Introduce the concepts and techniques relevant to an understanding of both financial and management accounting; and
2. Develop the ability to apply those concepts and techniques.

Module Content

• Users of accounting statements
• Functions of financial and management accounting
• Preparation of the main financial statements
• The application of the accruals concept, matching expenditure to income, depreciation, provisions
• An introduction to management accounting and the role of the management accountant
• Analysis of how cost behaviour patterns can be used for decision-making purposes
• Understanding of absorption costing and accounting for overheads, principles of Activity Based Costing
• Break-even charts, profit volume graphs break-even point, the margin of safety and the contribution/sales ratio

Intended Learning Outcomes

• Understand the process of company account preparation using accruals and prepayments
• Explain the influence and importance of accounting standards and other legislation on the production of published financial statements
• Examine costing systems, absorption costing and overheads, and the potential benefits of Activity Based Costing
• Understand the use of marginal costing for short term decision making
• Recognise the utility of break-even charts and profit volume graphs

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