NTC GTLE past questions and key areas to focus on for Accounting SHS based on the content areas

PART 1: FINANCIAL ACCOUNTING

1. Nature, Evolution & Regulatory Framework of Accounting

• Past Question Example: "Distinguish between Financial Accounting and Management Accounting." Answer: Financial Accounting focuses on external reporting (e.g., financial statements for investors), while Management Accounting provides internal information for decision-making.

• Key Topics:

  • IFRS vs. IAS

  • Qualitative characteristics of accounting information (Relevance, Reliability, Comparability)

  • Users of accounting information (Investors, Creditors, Government)

2. Fundamental Principles of Accounting

• Past Question Example: "What is the purpose of a Bank Reconciliation Statement?" Answer: To reconcile differences between the cash book and bank statement due to timing differences (e.g., unpresented cheques).

• Key Topics:

  • Double-entry bookkeeping

  • Correction of errors (Suspense Account usage)

  • Depreciation methods (Straight-line vs. Reducing Balance)

3. Preparation of Final Accounts

• Past Question Example: "Prepare a Statement of Profit or Loss from the given trial balance." Focus Areas:

  • Adjustments (Accruals, Prepayments, Depreciation)

  • Manufacturing Accounts (Prime Cost, Factory Overheads)

  • Partnership Accounts (Profit-sharing ratios, Goodwill)

4. Interpretation of Financial Statements

• Past Question Example: "Calculate and interpret the Current Ratio and Acid-Test Ratio." Key Ratios:

  • Liquidity (Current Ratio, Quick Ratio)

  • Profitability (Gross Profit Margin, ROCE)

  • Gearing Ratio (Debt vs. Equity)

5. Ethics in Accounting

• Past Question Example: "Explain TWO ethical dilemmas an accountant may face." Answer: Conflict of interest (e.g., auditing a family business), Confidentiality breaches.

PART 2: COST ACCOUNTING

1. Cost Classification & Elements of Cost

• Past Question Example: "Classify the following costs as Fixed, Variable, or Semi-Variable." Key Terms:

  • Direct vs. Indirect Costs

  • Prime Cost = Direct Materials + Direct Labour

2. Materials & Labour Costing

• Past Question Example: *"Calculate EOQ given Annual Demand = 10,000 units, Order Cost = GH₵50, Holding Cost = GH₵2/unit."* Formula:

  EOQ=2×Demand×Order CostHolding CostEOQ=Holding Cost2×Demand×Order Cost​​

3. Overheads & Activity-Based Costing (ABC)

• Past Question Example: "Allocate overheads using Machine Hour Rate." Steps:

  1. Total Overheads / Total Machine Hours = Rate per Hour

  2. Apply rate to products based on usage.

4. Costing Methods (Job, Process, Service)

• Past Question Example: "Prepare a Process Account with Normal Loss (10%) and Abnormal Loss." Key Points:

  • Equivalent Units (for WIP valuation)

  • Joint Products vs. By-Products

5. Marginal vs. Absorption Costing

• Past Question Example: "Reconcile profits under Marginal and Absorption Costing." Difference:

  • Marginal Costing: Fixed costs treated as period costs.

  • Absorption Costing: Fixed costs absorbed into product costs.

6. Budgeting & Variance Analysis

• Past Question Example: "Calculate Material Price and Usage Variances." Formulas:

  • Price Variance = (Standard Price - Actual Price) × Actual Quantity

  • Usage Variance = (Standard Quantity - Actual Quantity) × Standard Price

Exam Tips:

1. Practice Numerical Problems: Focus on Ratios, Depreciation, EOQ, and Variance Analysis.

2. Understand Adjustments: Accruals, Prepayments, Bad Debts in Final Accounts.

3. Ethics & Standards: Know IFRS/IAS and ethical frameworks (Confidentiality, Independence).

4. Time Management: Allocate more time to Company Accounts & Process Costing (higher-weight areas).

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Good luck! 🚀