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Home >> ISC (XI - XII)
 

Aims:
  1. To enable candidates to acquire knowledge (information) and develop an understanding of facts, terms, concepts, conventions, trends, principles, generalisations, assumptions, hypotheses, problems, processes, etc. in Economics.
  2. To acquaint candidates with tools of economic analysis.
  3. To develop an understanding of important economic problems.
  4. To acquaint candidates with the main institutions through which the productive process is carried out.
  5. To develop an understanding of the role of institutions in the functioning of an economy.
  6. To enable candidates to compare their own economic structure with that of the other areas of the world.

CLASS XI

There will be one paper of 3 hours duration of 100 marks divided into 2 parts.
Part 1 (30 marks) will consist of compulsory short answer questions testing knowledge, application and skills relating to elementary/ fundamental aspects of the entire syllabus.
Part 2 (70 marks) will consist of eight questions out of which the candidate will be required to answer five questions. Each question in this Part shall carry 14 marks.
Note: The syllabus is intended to reflect a study of the theory of Economics with specific reference to the Indian Economy. Therefore, examples and specific references to the Indian Economy must be made wherever relevant.

1. Understanding Economics

  1. Definition of Economics: Adam Smith, Alfred Marshall, Lionel Robbins, Samuelson.
    Basic understanding of economics and economic phenomena to be explained especially in the context of the concept of scarcity and allocation of resources. Students may be introduced to the main points on which the various definitions of economics could be analyzed. Features of definitions and two- three criticisms.
  2. Basic concepts: utility, price, value, wealth, welfare, money, market, capital, investment, income, production, consumption, saving.
    A conceptual understanding of the terms: utility – types and features, total utility, marginal utility and diminishing marginal utility; price – definition and general rise and fall in price; value – real vs nominal value; wealth – explanation of the term, classification (personal and social); welfare – economic welfare, social welfare and relation between wealth and welfare; money – barter economy vs money economy; market – meaning and size; capital – meaning; investment – meaning, investment as a process of capital formation; income – meaning, factor incomes; production – meaning; consumption – meaning; saving – meaning and saving vs savings.
    The above terms to be explained with the help of relevant examples.
  3. Basic problems of an economy: what to produce; how to produce; for whom to produce; efficient use of resources; economic growth and development.
    The basic problem of scarcity and choice must be emphasized. As this problem is universal in character, i.e. faced by all economies, irrespective of the economic system they follow, it must be explained using the concept of Production Possibility Curve. The three problems - what to produce, how to produce and for whom to produce - must be highlighted. The role of technology and a shift in the Production Possibility Curve must be explained. A brief explanation of the term ‘economic growth’, ‘economic development’ and distinction between the two is required.
  4. Types of economies: developed, under developed and developing; Economic systems: capitalism, socialism and mixed economy; mechanism used to solve the basic problems faced by each economy.
    Characteristics of developed and developing economies; Development experience of India: a comparison with neighbouring countries (Pakistan and China) in terms of growth, population and sectoral development (introducing regional and global economic grouping such as SAARC, European Union, ASEAN, G-8, G-20 - basic knowledge); different types of economic systems; definition, features, merits and demerits of capitalism, socialism and mixed economic system; mechanisms used to solve the basic problems under each economic system to be explained with the help of case studies. The role of government along with the price mechanism to be emphasized.

2. Indian Economy - Challenges

  1. Population: Theories of Population (Malthusian and Optimum); Theory of Demographic Transition; population growth over the years; census of 2001; age, sex composition; density of population and occupational distribution; the current National Policy on Population. Overpopulation and under population - merits and demerits.
    A brief introduction of features of Malthusian, Optimum and Demographic theories of population. Conceptual understanding of the following: changes in age, sex ratio, density of population and the occupational distribution (emphasis to be laid on trends and not on statistical data). Effects of population growth on the economy. The manner in which demographic profile of Indian population is changing, must be explained. Main features of the latest National Policy on Population of the Government of India.
  2. Problem of unemployment: meaning, types; causes and measures to remove unemployment; government measures to remove unemployment post 1991. Basic knowledge of the concept of full employment.
    The nature of unemployment problem in India and types of unemployment - seasonal, involuntary, voluntary, disguised, cyclical, structural, open, frictional and under-employment to be explained. An analysis of the causes of the problem and main points of the recent employment policy of the Indian government to be analyzed with the help of statistical information on the subject.
  3. Poverty: meaning of poverty line; vicious circle of poverty; causes of poverty; attempted solutions including governmental measures.
    Poverty should be defined on the basis of calorie intake (and not in monetary terms). The meaning of poverty - absolute poverty and relative poverty to be explained. The concept of poverty line with reference to calorie intake, the vicious circle of poverty, both on demand side as well as on supply side with solutions for breaking the vicious circle of poverty. The various programmes (post 1991) and the latest policy of the government to solve this problem.
  4. Inequalities in income distribution; causes; consequences and measures to reduce inequalities.
    Meaning of inequality in income distribution - rural-rural, urban-urban and rural-urban (emphasis to be laid on trends and not on statistical data). A basic understanding of the problem of inequalities in income distribution to be emphasized. A brief analysis of the causes and consequences. The various programmes (post 1991) and the latest policy of the government to solve this problem.
  5. Indian Agriculture: role of agriculture in Indian Economy - an overview; Indian agricultural policy; importance of land reforms, agricultural inputs and Green Revolution, modern agricultural practices; sources of agricultural finance: institutional vs. non-institutional; food security; public distribution system in India.
    An overview of the role of agriculture in the Indian economy with respect to its contribution to national income, industry and employment. Why land reform is needed to overcome the problem of sub-division and fragmentation of agricultural holdings which have been the cause of low productivity of Indian agriculture (including the problem created due to absentee landlordism). The important role played by the Green Revolution in solving food problem. Special focus on modern agricultural practices, for e.g. biotechnology, agricultural research and agricultural marketing The sources of agricultural finance - institutional vs. non-institutional. The role of Public Distribution System in providing food security in India. The various programmes (post 1991) and the latest policy of the government.
  6. Industrial sector: role and performance of public sector in Indian economy; problems of public sector enterprises; the issue of privatization in the light of liberalization.
    The role of industrial sector in India’s development to be explained. The rationale behind public sector enterprises in India. Various problems being faced by these enterprises (emphasis to be laid on trends and not on statistical data). The question of privatization - its pros and cons, disinvestment of PSU to be explained. The Industrial Policy of 1991, New Economic Policy and the latest Industrial Policy of the government.
  7. Capital formation in India: why the rate of savings and capital formation is low in India. Human capital formation.
    Capital formation - meaning, process, causes of low rate of savings and capital formation, remedies. A basic understanding of these issues to be given with the help of latest statistical data.
    Human capital formation: how people become resource; role of human capital in economic development: growth of education sector in India.

3. Money and Banking

  1. Money: meaning, functions of money.
    Meaning, evolution of money, kinds of money, functions of money (primary, secondary and contingent) to be explained.
  2. Banks: functions of commercial bank; reserve money, credit creation by commercial banks; Central Bank: need, functions.
    Basic understanding of the functions of commercial banks, credit creation process. The regulatory role of the Central Bank, its functions and the way it controls the flow of credit needs to be explained. A brief mention may be made of CRR, SLR, Bank Rate policy and Open Market Operations.
  3. Inflation: definition, types, causes: cost-push, demand-pull; effects of inflation on different groups of society; fiscal, monetary and other measures to control inflation.
    Definition, types of inflation. The factors on the demand side - demand pull inflation and on the supply side - the cost push inflation, must be explained. The effects of inflation on salaried classes, borrowers, lenders, hoarding, inventory, etc. to be explained. A brief explanation of the measures to check inflation – fiscal, monetary and other measures.

4. Statistics

  1. Statistics: definition, scope and limitations of statistics.
    Statistics: definition, scope and limitations of statistics. Special emphasis to be laid on importance of statistics in economics.
  2. Measures of Central Value: average defined; type of averages: arithmetic mean; simple and weighted; median and mode; ungrouped and grouped data; numericals, relationship between mean, median and mode.
    Measures of Central Value: average defined; type of averages: arithmetic mean; simple and weighted; median and mode; ungrouped and grouped data. Numericals only on mean, median and mode for both ungrouped and grouped data. Relationship between mean, median and mode – the nature of the frequency distribution – symmetrical, positively skewed and negatively skewed.
  3. Measures of dispersion: definition, methods of studying variation - range; standard deviation; the mean or average deviation; coefficient of variation; the Lorenz curve.
    Numericals on measures of dispersion required.
  4. Correlation: introduction, scatter diagram; Karl Pearson’s coefficient of correlation; Spearman’s coefficient of correlation.
    Significance of correlation to be explained along with types and degrees. Numericals on coefficient of correlation required.
  5. Index numbers: simple and weighted - meaning, types and purpose. Problems involved in constructing a Price Index Number.
    What does an Index number show, measure or indicate (like a Price Index Number). Difference between simple and weighted – Price weighted or quantity weighted. Problems involved in constructing Price Index Number – the choice of the base year, the number of commodities to be included (coverage), choice of prices and the method to be used.
CLASS XII

There will be one paper of 3 hours duration of 100 marks divided into 2 parts.
Part 1 (30 marks) will consist of compulsory short answer questions testing knowledge, application and skills relating to elementary/ fundamental aspects of the entire syllabus.
Part 2 (70 marks) will consist of eight questions out of which the candidate will be required to answer five questions. Each question in this Part shall carry 14 marks.
Note: The syllabus is intended to reflect a study of the theory of Economics with specific reference to the Indian Economy. Therefore, examples and specific references to the Indian Economy must be made wherever relevant.

1. Micro Economic Theory

  1. A basic understanding of the micro and macro economics is needed. Interdependence and differences between micro and macro economics.
  2. Demand: meaning, factors affecting demand; Demand function; Law of Demand; derivation of demand curve; movement and shift of the demand curve; exceptions to the Law of Demand.
    Law of Diminishing Marginal Utility, Law of Equimarginal Utility, consumers equilibrium through utility approach.
    The concept of demand (exante) and effective (expost) demand. A demand function to be specified incorporating the determinants of demand. Diagrams should be used in explaining the Law of Demand, its derivation using demand schedule. Derivation of market demand curve from individual demand curve.
  3. Law of Diminishing Marginal Utility, Law of Equimarginal Utility and consumer’s equilibrium with the help of schedule and graph.
  4. Elasticity of demand: meaning, types of elasticity of demand, measurement of elasticity of demand; factors affecting elasticity of demand; importance of the concept of elasticity of demand.
    Various methods of measurement of the elasticity of demand: point method, arc method, percentage method, expenditure method and geometric method. (Numericals required on percentage method only). The cross and income elasticity of demand must be explained. Use diagrams wherever necessary. Degrees of elasticity of demand to be explained.
  5. Supply: meaning; difference between stock and supply; determinants of supply; time period and supply; Law of Supply; movement and shift of the supply curve; elasticity of supply
    Difference between stock (actual supply) and supply (intended supply) with reference to the time period, with the help of certain examples. A supply function should be specified and explained. Law of Supply, supply schedule and supply curve. Derivation of market supply curve from individual supply curve. Movement and shift of the supply curve. Meaning and degrees of elasticity of supply (methods of measuring elasticity of supply are not to be included).
  6. Equilibrium price and effect of changes in demand and supply on the equilibrium price.
    A basic understanding of the concept of equilibrium. The effects of changes in demand and supply - both along the curves and shift of the curves to be explained.
  7. Concept of product and production function: returns to a factor, total, average and marginal physical products; Law of Variable Proportions and its three stages; returns to scale.
    A production function to be specified and explained (concept only - specific production function not required). Law of Variable Proportions: statement, assumptions, schedule (for the purpose of understanding and not for testing), diagram and explanation to the three stages and criticism. A comparison should be made between Law of Variable Proportion and the returns to scale concepts.
  8. Main market forms: perfect competition, monopolistic competition, oligopoly, monopoly; characteristics of the various market forms; equilibrium of firm under short run and long run under perfect competition.
  9. Features of perfect competition, monopolistic competition, oligopoly and monopoly. Equilibrium of firms under short run and long run, under perfect competition (to be explained with the help of diagrams).
  10. Cost and revenue: Basic concepts of cost; fixed cost, variable cost, total cost, marginal cost and average cost – their relationships; opportunity cost; short run and long run cost curves – internal and external economies and diseconomies. Revenue: meaning; average revenue, marginal revenue and total revenue and their relationships under perfect competition and imperfect competition.
    Basic concepts – private cost, economic cost, social cost, money cost, real cost, explicit cost, implicit cost.
    Cost concepts – Fixed cost, variable cost, total cost, marginal cost, average cost with schedule and diagram; relationship between average cost, marginal cost, total cost. Derivation of long run average cost curve from short run average cost curve. Opportunity cost – meaning only.
    Revenue – Average revenue, marginal revenue, total revenue – concepts and relationships under perfect competition and imperfect competition.
  11. Factor pricing: basic concepts of rent, wages, interest and profit.
    Basic concepts of economic rent, transfer earning, quasi-rent; nominal wages and real wages, collective bargaining; gross interest, net interest, gross profit and net profit.

2. National Income

  1. Circular flow of Income.
    A simple model explaining the circular flow of income with two, three and four sector models with leakages and injections.
  2. Nature of goods and services produced.
    Economic and non economic goods, economic and non economic services, intermediate and final goods, consumer goods and producer goods, single-use and durable-use goods.
  3. Concepts and definition of NY, GNP, GDP, NNP, private income, personal income, personal disposable income and per capita income; relationship between the income concepts.
  4. A brief understanding of the mentioned national income aggregates is needed. The concepts of GNP and NNP should be explained both at factor cost and market prices.
  5. Methods of measuring National Income: product or value-added method; income method and expenditure method with simple numericals based on them.
  6. Simple numericals based on all the methods to be covered for better understanding of the concept. Precautions and difficulties of measuring National Income for each method.

3. International Trade

  1. Need for international trade; basis of international trade in terms of the Theory of Comparative Costs (Ricardo).
    Need, advantages, disadvantages of international trade; the Theory of Absolute Cost and Comparative Cost in terms of Opportunity Cost to be explained as a basis of international trade. Production Possibilities Curve (PPC) - to be used for illustration.
  2. Balance of Payments: Balance of Trade -meaning; causes of disequilibrium in B.O.P.; measures to correct the disequilibrium in the B.O.P.
    The concepts of balance of trade, balance of current account and balance of capital account to be explained. The causes of disequilibrium and the measures, both monetary and fiscal to be explained.

4. Public Finance

  1. Public Revenue: meaning; Taxes: types, direct, indirect taxes, cannons of taxation; progressive, proportional, regressive, digressive (meaning only). Sources of central and state revenue (names only); VAT.
    A basic understanding of the above mentioned concepts. The concept of VAT to be explained. MODVAT, CENVAT (for the purpose of understanding and not for testing).
  2. Public Expenditure: meaning, reasons for growth of public expenditure in recent times.
    The growth of the public expenditure in view of increasing functions and responsibilities of the government to be explained.
  3. Public Debt: reasons for external and internal borrowing by the government; methods of debt redemption; effects of borrowing on the Indian economy.
    Public Debt: meaning; types: internal-external, productive-unproductive, redeemable-irredeemable, funded-unfunded, voluntary and forced, short-term and long-term, marketable and non-marketable debts; reasons for external and internal borrowing by the government; debt redemption methods, effects of borrowing on the Indian economy.
  4. Fiscal Policy: meaning, objectives and instruments of fiscal policy.
    Meaning, objectives and instruments of fiscal policy (taxation, public debt, public expenditure).
  5. Deficit Financing: meaning, types of deficit, “why” deficit financing and effects of deficit financing. Indian compulsion for deficit financing.
    To be explained in the context of rising public expenditure and inadequacy of revenues of the government to meet this requirement. Types of deficits: a conceptual understanding of fiscal deficit, budget deficit, revenue deficit and primary deficit.
  6. Budget: meaning, importance and types; budgetary procedure: preparation, enactment, execution and parliamentary control over finance, in brief.
    Meaning, importance and types of budget – union, state, planned, performance, supplementary, zero-base, vote on account, revenue, capital; concept of deficit, surplus and balance budgets.
    The budgetary procedure requires only a brief mention (for the purpose of understanding and not for testing).
 
 

Aims:

  1. To develop an interest in the theory and practice of business, trade and industry.
  2. To familiarise candidates with theoretical foundations, organising, managing and handling operations of a business firm.
  3. To provide a study of the more important aspects of the commercial world.
  4. To provide knowledge of the activities of commerce in the marketing of goods and services.

CLASS XI

There will be one paper of 3 hours duration of 100 marks divided into two parts.
Part 1 (30 marks) will consist of compulsory short answer questions testing knowledge, application and skills relating to elementary / fundamental aspects of the entire syllabus.
Part 2 (70 marks) will have nine questions out of which candidates will be required to answer seven questions and each question will carry 10 marks.

1. Nature and Purpose of Business

  1. Definition and concept of business; classification of business activities.
    Five to six popular definitions of business, highlighting different aspects of business, with a final conclusive definition. Characteristics of business. Classification of business: Industry and types of industries, Commerce.
  2. Business objectives and necessity.
    Business objectives: economic; social; profit objective in detail with relevance to all the stakeholders. Necessity.
  3. Commerce: branches of commerce; economic basis of commerce.
    Commerce and its nature, functions; importance of commerce. Branches of commerce - trade and aids to trade. Relationship between commerce, trade and industry. Economic basis of commerce.
  4. Human wants and their satisfaction; classification of wants, characteristics of wants.
    Human wants - meaning and their importance towards satisfaction; classification of wants, characteristics of wants.
  5. Division of labour: specialisation and localisation factors affecting labour.
    Self-explanatory.
  6. Classification of human activities - economic and non economic.
    Classification of human activities - economic and non-economic. Types of economic and non-economic activities.
    Distinction between business, profession and employment.

2. Forms of Business Organisations

  1. Sole trader - objective; formation; merits and demerits.
    Meaning and definition of sole trader; characteristics of sole trader; formation; merits and demerits.
  2. Partnership - formation; features; types of partners.
    Meaning and definition of partnership; formation of partnership firm; features of partnership firms; types of partners.
  3. Partnership - registration; dissolution under different circumstances.
    Self-explanatory.
  4. Evaluation of partnership; merits and demerits.
    Self-explanatory.
  5. Comparison of sole proprietorship and partnership.
    Self-explanatory.
  6. Joint-stock company: meaning; characteristics; merits and demerits; causes of popularity.
    Meaning and characteristics of Joint-stock company. Distinction between companies and partnership firms; merits and demerits of companies. Causes of popularity.
  7. Types of companies - public and private companies - differences; advantages and disadvantages.
  8. Types of companies: public and private companies - differences; advantages and disadvantages of both the types.
  9. Public enterprise - meaning; role and growth; forms of organisation. Departmental undertakings; Public Corporations and Government companies including public utility services.
    Public enterprise - meaning; role and criticism. Growth of public enterprises. Forms of organization. Departmental undertakings; Public Corporations and Government companies including public utility services. (define and explain each of the forms).
    Problems and suggestions for improvement.
  10. Co-operative forms of organisation - meaning; characteristics; formation. Different types of co-operatives.
    Co-operative forms of organization - meaning; characteristics; formation. Distinctive advantages and disadvantages of this form.

3. Stock Exchange

  1. Meaning and importance.
  2. Functions and services.
  3. Major Stock Exchanges in India (BSE, NSE, DSE, ASE) - types and locations.
  4. Types of operators-Brokers, Jobbers, Bulls and Bears.
  5. Terms used in Stock Exchange- ex-dividend, cum dividend, spot delivery, forward delivery.
  6. Self-explanatory.

4. Inland Trade

  1. Channel of distribution: direct/indirect -factors influencing the choice of channel.
    Channel of distribution: direct/indirect, meaning and definition along with functions. Factors influencing the choice of channel: product considerations; market considerations; company considerations; middlemen considerations (agent and merchant middlemen).
  2. Wholesale trade; necessity and objectives.
    Meaning, definition, characteristics and necessity of wholesale trade.
  3. Services to retailer, customer and producer.
    Self-explanatory.
  4. Survival or elimination of wholesalers.
    Arguments for elimination of wholesalers and arguments against middlemen; both positive and negative sides need to be discussed critically.
  5. Retail trade - necessity and objectives.
    Retail trade - meaning, definition and characteristics of retail trade. Functions of retail trade. Distinction between wholesale and retail trade.
  6. Functions of retailers. Factors affecting the establishment of a retail outlet. Threat to small retailers - survival of small retailers.
    Functions of retailers; types of retailers; factors affecting the establishment of a retail outlet; threat to small retailers - survival of small retailers (relevant real life industry examples can be helpful).
  7. Types of retail organisations - departmental store, chain store, mail order houses, tele shopping, franchise, consumer's cooperative stores including super bazaars.
    Meaning, features, merits and demerits to be covered.
  8. Consumer protection: rights of consumers, methods of consumer protection.
    Need for consumer protection; rights of consumers; methods of consumer protection; Consumer Protection Act, 1986.
  9. Documents used in home trade. Enquiry catalogues - invoice, debit note, credit note, cash discount and trade discount.
    Documents and procedure used in home trade – inquiry; quotation; catalogues; order; invoice; debit note; credit note.
    Price quotations - cash discount and trade discount.
  10. Role of Chambers of Commerce and Industry.
    Meaning of Chambers of Commerce and trade associations; distinction between Chambers of Commerce and trade associations; role and functions of Chambers of Commerce and trade associations in developing industry.
    National level Chambers of Commerce - FICCI, CII, etc.

5. Foreign Trade

  1. Meaning, difference between internal trade and external trade.
    Self-explanatory.
  2. Characteristics of international trade.
    Characteristics of international trade; problems of international trade; advantages and disadvantages of international trade.
  3. Export trade - objectives and purpose.
    Meaning, definition and functions of export trade; objectives and purpose.
  4. Procedure of export trade.
    Self-explanatory.
  5. Import trade - objectives and purpose.
    Meaning, definition and functions of import trade; objectives and purpose.
  6. Procedure of import trade.
    Self-explanatory.
  7. Documents involved in international trade.
    Documents involved in export trade, such as: indent, letter of credit, shipping order, shipping bill, mate’s receipt, bill of lading, certificate of origin, consular invoice, documentary bill of exchange (DA/DP), all need to be explained.
    Documents involved in import trade, such as: import license, indent, letter of credit, documentary bill of exchange, bill of entry, bill of sight, port trust dues receipt, application to import, advice note, bill of lading, all need to be explained.
  8. Balance of payment. International financial institutions - WB, ADB, etc.
    Balance of payment concept.
    World Bank, International Development Association, International Finance Corporation, International Monetary Fund, Asian Development Bank; their functions, management, resources and financing criteria; their role in the development of any economy especially of the Indian economy.

6. Warehousing

  1. Warehousing: meaning, objective, and necessity.
    Self-explanatory.
  2. Functions of warehousing.
    Self-explanatory.
  3. Types of warehouses - private; public; bonded and cold storage - meaning, advantages of each, documents used - warehouse receipt, warehouse warrant, delivery order.
    Types of warehouses - private; public; bonded and cold storage – meaning and advantages of each. Documents involved in each. Essential features of an ideal warehouse.

7. Insurance

  1. Insurance - objectives and purpose.
    Insurance - meaning, objectives and purpose; Concept of re-insurance and double insurance.
  2. Risks in business - insurable and non-insurable.
    Causes of business risk -- internal and external risks; risks in business - insurable and non-insurable - meaning and characteristics of both.
  3. Principles of insurance.
    Six fundamental principles to be explained: utmost good faith; insurable interest; indemnity; contribution; doctrine of subrogation; causa proxima.
    Advantages of insurance: to businessman; to public and society.
  4. Types of insurance: fire, marine, life insurance - methods of taking out policies, submission of claims.
    Method of taking of each type of insurance policy; kinds of policies of each (like kinds of fire insurance etc.); settlement of claims under each.
    Marine losses: total - actual constructive; partial - particular average loss and general average loss.
    Distinction between fire, marine and life insurance.
  5. Functions of Life Insurance Corporation.
    Meaning and definition of life insurance; procedure for taking life insurance; functions of Life Insurance Corporation of India.
  6. Lloyds of London – insurance underwriter.
    Concept of underwriting. Role of Lloyds of London.

Teaching and Learning Activities

1. Natures and Purpose of Business
Select a few products/services which students are familiar with. Distribute these to different groups and ask them to trace their origin, the various people and activities involved until these reach consumers. There after a discussion based on their experiences and findings should be arranged.

2. Forms of Business Organisation
Pay a visit, along with the class to a nearby business locality. Make a list of various business firms and classify them into sole-proprietorship, partnership, etc.
Explore a few establishments, which have changed from Sole proprietorship to Partnership and the reasons for the change. Make a list of all the joint stock companies in the same locality; find the proportion of public limited companies and private limited companies among them.

3. Inland Trade
Visit a wholesale market in the city and observe the modes of operation. Discuss with some retailers in the locality as to how they would be affected if the wholesalers were eliminated. Find out the proportion of large retailers to small retailers and the effect of the presence of large retailers on small retailers. Make a list of articles that are sold on hire-purchase basis and assess their popularity and mode of transaction.
Collect some blank samples of Invoices, Credit Notes, Debit Notes, etc. and let the students practice preparing some on the same lines.
Visit or read up about the Chambers of Commerce and Industry and find out the services provided by them.

4. Foreign Trade
Go through the local Yellow Pages and list the names of exporters and also find out which products are more popular in the export-market.
Discuss with the owner of a well-established export-house, the difficulties they face in export trade. Compare these with the difficulties faced by the traders in the home market.
Collect and display the documents used in foreign trade (like Indent, Letter of Credit, Bill of lading, Charter Party etc.)

5. Warehousing
If possible, visit a warehouse / cold storage facility and have a first hand experience of its method of operation.

6. Insurance
Collect newspaper clippings on the theme of insurance. Meet an LIC agent and discuss with him, the way he operates, canvasses about insurance, calculates premium, etc. Arrange for a lecture by an officer from the General Insurance Corporation on the methods of taking policies and submission of claims, etc.
Visit a nearby LIC Office to see how it handles the Life Insurance business. Collect literature on Lloyds, circulate it in the class, and then hold a discussion.

CLASS XII

There will be one paper of 3 hours duration of 100 marks divided into 2 parts.
Part 1 (30 marks) will consist of compulsory short answer questions testing knowledge, application and skills relating to elementary / fundamental aspects of the entire syllabus.
Part 2 (70 marks) will have nine questions out of which candidates will be required to answer seven questions and each question will carry 10 marks.

1. Corporate Organisation

  1. Joint Stock Company: meaning and objectives.
  2. Formation of a Company.
  3. Promotion, meaning and role of promoters.
  4. Incorporation of Company.
  5. Memorandum of Associations and Articles of Associations (excluding alterations) and distinction between the two documents.
  6. Filing of documents and registration.
  7. Certificate of incorporation.
  8. Communicating of business.
  9. Prospectus - its nature and importance, statement in lieu of prospectus.
  10. Public and private companies and their comparative studies, privileges of private companies, private companies deemed to be public.
  11. Government companies: objectives, necessity, merits and demerits.
  12. Multinational Corporations - objectives and role, various forms - branches, subsidiaries, joint venture, franchise holders, turnkey projects, merits and demerits of multinational corporations.
    Self-explanatory

2. Management Personnel

  1. Board of Directors: number of directors, qualification of directors, vacation or disqualification of director.
    Self-explanatory.
  2. Method of appointment of the directors.
    Appointment of directors - method to be explained under different heads: by promoters; by members; by the board; by central government; by third party; by proportional representation.
  3. Powers and duties of directors; remuneration of directors.
    Functions and powers of directors; duties of directors; remuneration to directors.
  4. Directors: full time/part time.
  5. Managing Director: selection and power (excluding manager).
  6. Directors: removal as per Companies Act.
    Managing Director - role; main features of an MD’s position; difference between MD and full time director. Manager - definition; distinction between MD and manager. Removal of directors as per Companies Act.

3. Financing

  1. Capital: different types for sole trader; partnership; joint stock.
    Importance of finance for business. Capital for different types of business firms. Factors affecting capital plan for an industry. Fixed capital - meaning, factors affecting fixed capital. Working capital - meaning, factors affecting working capital.
  2. Sources of capital for Joint Stock Company. Different types of shares: equity, preference - their advantages and disadvantages.
    Sources of capital – debt and equity; long and short term sources of funds.
    Long-term sources of funds (equity shares, preference shares and retained earnings, Financial Institutions, public debt instruments); equity shares - different types, features, advantages and disadvantages; preference shares - features, advantages and disadvantages; distinction between equity
    shares and preference shares. Retained earnings - merits and demerits.
    Short-term sources of funds (public deposits, CB’s, trade credit and other sources); distinction between shares and debentures.
    Advantages and Disadvantages of various sources of funds.
  3. Loan capital; debentures - different types of debentures.
    Debentures - meaning; distinction between shares and debentures; kinds of debentures; advantages and disadvantages of debentures.
  4. Financial institutions: IFCI; SFC; ICICI; IDBI; UTI; Mutual Funds - their working, merits and demerits.
    Role of Developmental Financial Institutions (DFIs). Merits and demerits of DFIs. Aim of DFIs.
    IFCI, SFC, ICICI, IDBI, UTI - functions, scope and forms of assistance of each; management and working of each.
    Mutual funds: meaning and definition; types of mutual funds (open ended/ close ended). Income, growth and balanced mutual funds. Merits and demerits of mutual funds.
  5. Commercial banks: services provided.
    Role of commercial banks; types of bank deposits; fund and fee-based activities.
  6. Acceptance of deposits: different categories of deposits.
    Public deposits - meaning; merits and demerits of public deposits.
  7. Lending: different types of lending.
    Different types of lending: trade credit; instalment credit; factoring services; customer advances.

4. Management

  1. Management: objectives and concept.
    Concept of management. Meaning of management: as an activity; as a group; as a discipline; as a process.
  2. Definition of management, nature of Management - Science and Art.
    Definitions of management: as a function; scientific school or classical definition; neo-classical or human relation definition; decision making and leadership concept; modern management (integration concept); nature of management - science and art.
  3. Characteristics of management.
  4. Importance of management.
  5. Function of management: planning; organising; staffing; directing; controlling.
  6. Principles of management: nature of principles; need for principles.
    Objectives or functions of management. Importance of management. Managerial functions - PODSCORB (planning, organizing, directing, staffing, coordinating, reporting and budgeting). Functions and sub-functions of PODSCORB; meaning, features, steps and importance of PODSCORB. Nature and principles of management; need for principles of management; Taylor’s 5 scientific principles of management; Fayol’s 14 principles of management; Universality of principles of management. Relevance of the principles of management in today’s business scenario. Comparison of Taylor's and Fayol’s principles.

5. Communication

  1. Meaning and objectives.
    Meaning, nature, objectives and importance of communication.
  2. Communication: barrier; elimination.
    Barriers to communication. Overcoming barriers to communication.
  3. Communication: different methods; channels.
    Methods or media of communication: written, oral; advantages and disadvantages of both methods. Differences between written and oral communication.
    Channels of communication: formal communication, informal communication; advantages and disadvantages of both channels. Meaning of and differences between formal and informal communication.
  4. Principles of communication.
    Principles of effective communication.
  5. Need for rapid and efficient communication. Role of e-mail, SMS, video-conferencing and other new technology initiatives.
    Self-explanatory.

6. Marketing

  1. Marketing: objectives; concept.
    Meaning of markets and marketing. Concept of marketing: traditional or production oriented; modern or consumer oriented. Comparison between marketing and selling. Objectives of marketing.
  2. Marketing: importance; functions.
    Importance of marketing. Functions of marketing: function of exchange; function of physical supply. Facilitating function.
  3. Advertising: meaning; objectives and functions.
    Meaning of advertising; objectives and functions of advertising; role and importance of advertising; criticism of advertising.
  4. Advertising: different media.
    Forms of advertising media: press, direct mail, outdoor advertising, audio-visual advertising.
    Types/ forms of each. Factors affecting choice of advertising media. Comparative evaluation of advertising media.
  5. Advertising agency: meaning, need and functions.
    Advertising agency - functions; departments of an advertising agency.
  6. Sales promotion: relation with advertising.
    Meaning of sales promotion. Objectives and functions of sales promotion. Types and techniques of sales promotion (use relevant examples of prevalent sales promotion schemes). Sales promotion relation with advertising.
  7. Salesmanship: meaning; objective.
    Meaning and definition of salesmanship (or personal selling). Objectives of salesmanship. Importance of salesmanship; difference between advertising and salesmanship. Steps in personal selling.
  8. Qualities of a good salesman.
    Qualities of a good salesman: physical qualities, mental qualities, social qualities, vocational qualities.


Teaching and Learning Activities

1. Corporate Organisation
Form a model of a Joint Stock Company in the school to run a business of selling Diwali/New Year Cards, storybooks, book binding, etc.
Make a list of public limited companies and private limited companies in a nearby business locality. Find out which of them have changed from a firm to a company and the reasons for the change. Visit the Registered Offices of a few companies, have a look at their Memorandum and Articles of Association, Prospectus, etc. Assess their size, line of activity, number of employees, etc. If necessary, similar information may be collected from newspapers and business publications.
From the news media, (Economic Times, Financial Times, television, etc.) find out the trend of multinational companies entering into India. Interview some well-established sole traders and partners of firms to know their fears of these multinationals.

2. Management Personnel
Display a chart on three levels of the school management on a bulletin board.

3. Financing
Students should collect advertisements of different types of shares, debentures and deposits floated by joint stock companies.
Encourage pupils to open their own bank accounts and scrutinise the operation from time to time.

4. Management
Use a simulation game, concerning management decision-making. As managers, students could organise a school annual function / sports meet, passing through the five functions of management. Prepare a report and present it to the class. School canteen management may be taken up by students under the supervision of a teacher, where all managerial activities throughout the year are done by them in rotation, giving everybody a chance to participate.

5. Communication
Use a bulletin board to show the communication process; role-play by students to show the process of communication - downward and upward, formal and informal, will be very beneficial. A panel discussion on barriers in communication and their elimination should be arranged.

6. Marketing
Display a comparison of selling and marketing and functions of marketing on the bulletin board. Clippings showing advertisements and examples of publicity of some business organisations from magazines and newspapers can also be displayed. Taking four important methods of advertising and selecting two specific advertisements in each, ask students to find out their benefits to manufacturers, to consumers and to society.
Students can be asked to collect material on various activities of sales promotion and display it in the class.
Invite one or two salesmen to talk on ‘Personal Selling’. A demonstration by a salesman may also be arranged.

 

Aims:

    1. To provide an understanding of the principles of accounts and practice in recording transactions and interpreting individual as well as company accounts.
    2. To develop an understanding of the form and classification of financial statements as a means of communicating financial information.
CLASS XI

There will be one paper of 3 hours duration of 100 marks divided into two parts.
Part I (30 marks) will be compulsory and will consist of two questions based on the entire syllabus.
Question 1 (20 marks) will include compulsory short answer questions, testing knowledge, application and skills relating to elementary/ fundamental aspects of the syllabus.
Question 2 (10 marks) will be a compulsory numerical question.
Part II (70 marks): Candidates will be required to answer five questions out of eight questions from this section. Each question shall carry 14 marks.

1. Basic Accounting Concepts

Background of accounting and accountancy: knowledge and understanding of GAAP; accounts - types and classification; basic terms used in accounting, Accounting Standards and Accounting Equation.

    (a)Evolution of accounting; difference between bookkeeping, accounting and accountancy; functions, characteristics, objectives, advantages and limitations of accounting; users of accounting information; subfields of accounting - meaning of financial accounting, cost accounting and management accounting.
    (b)Accounting concepts – GAAP - money measurement, dual aspect, going concern, periodicity, accrual, matching; realisation, business entity, materiality, consistency, conservatism, historical cost, disclosure and objectivity.
    (c)Basic Terms: Debtors, Creditors, Assets, Liabilities, Goods, Stock, Profit, Loss, Expense, Expenditure, Revenue, Income, Transactions, Drawings and Capital.
    (d)Accounting Standards – meaning and usefulness.
    (e)Basis of accounting – cash basis and accrual basis.
    (f)Accounting equation.

2. Journal and Ledger

(i) Journal: recording of entries in journal with narration.

    a) Classification of Accounts.
    b) Double Entry System.
    c) Rules of journalising.
    d) Meaning of journal.
    e) Format of journal.
    f) Simple and compound journal entries (with specimens to practice).
    g) Advantages of using a journal.
    h) Sub-division of journal - cash book (including petty cash book), sales day book, purchases day book, sales return day book, purchases return day book, bills receivable book, bills payable book and Journal proper.

(ii) Ledger: posting from journal to respective ledgers.

    a) Meaning of ledger.
    b) Format of a ledger.
    c) Mechanics of posting.
    d) Balancing of various ledger accounts.
    e) Practical problems on journal and ledger.

3. Cash Book and Bank Reconciliation Statement

(i) Cash book (including petty cash book): single column; double column; triple column.

    a) Cash Book: single, double and triple column cash book.
    • Meaning, need and importance.
    • Recording transactions in a cash book.
    b) Petty Cash Book -
    • Meaning and advantages.
    • Analytical Petty Cash Book.
    • Meaning and advantages of the Imprest System including practical problems.

(ii) Bank reconciliation statement.

    a) Meaning and need for bank reconciliation statement.
    b) Preparation of a bank reconciliation statement given in the cash book balance or the pass book balance or both.
    c) Preparation of a bank reconciliation statement given an extract of the cash book as well as the pass book relating to the same month.

4. Trial Balance, Rectification, Capital and Revenue Expenditure and Income

(i) Trial balance.

    a) Meaning, objectives, advantages and limitations of a trial balance.
    b) Preparation of the trial balance from given ledger account balances.
    c) Redrafting of a trial balance.

(ii) Errors and types of errors: errors of omission; errors of commission; errors of principles; compensating errors.

    a) Errors disclosed by the trial balance.
    b) Errors not disclosed by the trial balance.
    c) Rectification of errors after the preparation of trial balance and use of suspense account.

(iii) Capital and revenue expenditure/income.

    a) Meaning and difference between expenditure and expense, income and receipt.
    b) Meaning and difference between capital expenditure and revenue expenditure with examples.
    c) Meaning and difference between capital income and revenue income with examples.
    d) Meaning and difference between capital profit and revenue profit with examples.
    e) Meaning and difference between capital loss and revenue loss with examples.
    f) Meaning of deferred revenue expenditure with examples.
NOTE: Rectification of errors after the preparation of final accounts is not required.

5. Depreciation, Provisions and Reserves

(i) Depreciation.
Depreciation - meaning, need, causes, objectives and characteristics.

(ii) Methods of charging depreciation (straight line and WDV method).

    a) Method of recording depreciation – charging to asset account, creating provision for depreciation / accumulated depreciation, treatment of disposal of assets.
    b) Change of method (Retrospective method only – Accounting Standard – 6).

(iii) Application of depreciation with the above mentioned methods: problems with purchase and sale of assets. Change in method (Retrospective method as per AS - 6).
Application of depreciation with the above mentioned methods; problems with purchase and sale; retrospective change of method.

(iv) Provisions and Reserves.
Meaning, importance; difference between provisions and reserves; types of reserves - revenue reserve, capital reserve, general reserve, specific reserve and secret reserve.

6. Final Accounts and Manufacturing Accounts – Concept of Manufacturing, Trading, Profit and Loss account and Balance Sheet (with and without adjustments), Marshalling of Balance Sheet

(i) Concept of Manufacturing Accounts.
Find out the cost of manufacturing and preparation of a manufacturing account.

(ii) Meaning and preparation of Manufacturing, Trading, Profit and Loss account and Balance Sheet of sole tradership. (Horizontal format) – without adjustments.

(iii) Preparation of Trading Account, Profit and Loss Account and Balance Sheet with necessary adjustments.
Adjustments relating to closing stock, outstanding expenses, prepaid expenses, accrued income, income received in advance,
depreciation and bad debts, provision for doubtful debts, provision for discount on debtors and creditors, manager’s commission, goods sold on approval basis, abnormal loss, adjustments pertaining to goods, interest on capital and drawings.

(iv) Marshalling of a Balance Sheet: Order of liquidity and Order of permanence. Self explanatory.

7. Single Entry - Accounts from incomplete records

(i) Single entry and difference with double entry.

    (a) Meaning, characteristics and limitations.
    (b) Applications to practical problems/ exercises.
    (c) Difference between Statement of Affairs and Balance Sheet.

(ii) Ascertainment of profit/loss by statement of affairs method including application.
Self explanatory.

(iii) Application to Problems. Various types of problems under statement of affairs method/Balance Sheet approach.
NOTE:
Single entry system as applied to partnerships is not required.

8. Non Trading Organisation

(i) Non trading organization: meaning, objectives, necessity and treatment of specific items.
Self explanatory.

(ii) Different books maintained and differences between them.

    (a) Receipts and Payments Accounts: meaning, features, differences between Receipts and Payments Account and Cash Book.
    (b) Income and Expenditure Accounts: meaning, features, difference, between Income and Expenditure account and profit and loss account.
    (c) Balance Sheets and their respective roles.

(iii) Application of non-trading exercises involving: preparation of Receipts and Payments Account; Income and Expenditure Account and Opening and Closing Balance Sheet.

    (a) Preparation of Income and Expenditure Account and Balance Sheet when trial balance and other information is given.
    (b) Preparation of Income and Expenditure Account and Balance Sheet when Receipts and Payments Account and other information is given.
    (c) Preparation of Receipts and Payments Account when Income and Expenditure account, Balance Sheet and other information is given.
    (d) Preparation of opening and closing balance sheets when Receipts and Payments Account and Income and Expenditure Account and other information is given.
NOTE: Preparation of a Receipts and Payments Account only or an Income and Expenditure Account with a Balance Sheet from incomplete records need not be covered.

9. Bills of Exchange

(i) Introduction to Negotiable Instruments: explanation of basic terms.
Meaning of negotiable instruments; Bills of exchange, promissory note, cheque, advantages and disadvantages of Bills of Exchange, explanation of basic terms - drawer, drawee, payee, endorser, endorsee, bill at sight, bill after date, tenure of the bill, days of grace, due date, dishonour of a bill, noting charges, notary public, renewal of a bill and retirement of a bill.

(ii) Applications to practical problems/exercises.
Applications to practical problems including insolvency.
NOTE: Accommodation Bill is not required.

10. Introduction to the use of Computers in Accounting

(i) Applications of Computers in Accounting.

    (a) Automation of accounting process.
    (b) MIS reports.

(ii) Comparison of Manual and Computerized Accounting.
Meaning, advantages and limitations of Manual and Computerized System of Accounting.

(iii) Accounting Software.
Readymade and computerized accounting softwares. Advantages and disadvantages of each.

CLASS XII

There will be one paper of 3 hours duration of 100 marks divided into two parts.
Part I (30 marks): will be compulsory and will consist of two questions based on the entire syllabus.
Question 1 (20 marks) will include compulsory short answer questions, testing knowledge, application and skills relating to elementary/ fundamental aspects of the syllabus.
Question 2 (10 marks) will be a compulsory numerical question.
Part II (70 marks): Candidates will be required to answer five questions out of eight questions from this section. Each question shall carry 14 marks.


1. Inventory Valuation

(i) Inventory Valuation.
Meaning and importance of the periodic and perpetual inventory systems.

(ii) Meaning of goods received note, stores requisition note, material return note and materials transfer note.
Self-explanatory.

(iii) Methods of inventory valuation.
FIFO and LIFO with meaning, merits and demerits of both.

(iv) Meaning and format of a Bin Card
Practical application not required.

(v) Practical problems on LIFO and FIFO including surplus and returns; normal and abnormal losses.

    (a) Periodic Method.
    (b) Perpetual Method.
    (c) Preparation of Trading Account based on LIFO and FIFO.
NOTE:
(a) Stock reconciliation statement is not required.
(b) When a question does not specify whether shortage is normal or abnormal in nature, any method may be used.
(c) When the problem is silent perpetual inventory system to be followed.
(d) If Stocks are found in surplus, while making physical verification, these will appear in the receipts column and latest purchase price will be adopted for valuation.
(e) Returns to suppliers from stores will appear in the issues column and will be valued at the price these were originally purchased.
(f) Returns to stores from department will appear in the receipts column and will be valued at the price these were originally issued.
(g) If stocks are found deficit, while making physical verification (Normal loss) these will be absorbed by good units.

2. Cost Sheet

(i)Concept of cost sheet.
Concept of cost sheet; definition of cost; classification of cost; meaning of cost centre and cost unit; concept of cost accounting and financial accounting; objective of costing; advantages of cost accounting; format of a cost sheet; uses of a cost sheet.

(ii)Application of cost sheet.
Application of cost sheet to include valuation of finished goods, determining cost per unit and total cost (closing stock valuation both by LIFO or FIFO method).

NOTE: Budgeted cost sheet, tenders and quotations based on price escalation is not required.
Abnormal idle time are not to be added or deducted in the cost sheet.
Normal and abnormal bad debts are not to be added or deducted in the cost sheet.
Imputed costs are also not to be added or deducted in a cost sheet.


3. Joint Venture

Joint Venture: objectives; necessity and methods of accounting (recording of transactions in the books of one Joint Venturer, recording of transactions in the books of all Joint Venturers, recording of transactions in separate set of books).
Joint Venture: meaning, features, objectives and application of Joint Venture problems under three different methods of accounting.

    a) Recording of transactions in the books of one Joint Venturer.
    b) Recording of transactions in the books of all Joint Venturers.
    c) Recording of transactions in separate set of books.

NOTE:
Valuation of closing stock in Joint Venture including abnormal and normal losses and Joint Ventures for underwriting shares are included.
Interim settlement of accounts, interest calculation and incomplete ventures on the date of final settlement of accounts are excluded from the syllabus along with conversion of consignment into joint venture.

4. Self Balancing and Sectional Balancing System

(i) Meaning of Self Balancing System and application of the system in solving practical problems.
Meaning, classification of ledgers, transfer between subsidiary ledgers, advantages, and application of problems relating to adjustment accounts.

(ii) Meaning of Sectional Balancing System and application of the system in solving practical problems.
Meaning, classification of ledgers and application of problems relating to control accounts.

NOTE: Rectification of errors relating to Self-Balancing and Sectional Balancing are not required.

5. Partnership Accounts

(i) Partnership: definition, features – meaning and importance of partnership deed.
Self explanatory.

(ii) Practical problems on preparation of Profit and Loss Appropriation Account and Capital Accounts.

    (a) Profit and Loss Appropriation Account.
    (b) Partners’ capital accounts: types - fixed and fluctuating.
    Interest on capital, interest on drawings, salary, commission to partners, transfer to reserves and division of profit among partners.

NOTE:

  • Interest on partner’s loan to be taken as a charge against profits.
  • Interest on loan should be credited to a separate loan account.
  • Rent paid to a partner is a charge against profit and not an appropriation of profit and so it is to be debited to profit and loss account and not to profit and loss appropriation account and credited to partners’ current account in case of fixed capital system or to partners’ capital account when capitals are fluctuating.
  • Only the application (not the accounting treatment) of Joint Life Policy needs to be covered.
    NOTE: Adjustment of partnership net profits of prior years as well as adjustment of profits when a manager is treated as a partner and guarantee are not required.
(iii) Admission: Goodwill - concept and mode of valuation.
    a) Meaning of Goodwill.
    b) Mode of Valuation.
    • Average profit method.
    • Super profit method.

(iv) Accounting treatment of goodwill on admission of a partner.
Based on Para 36 of Accounting Standard – 10 issued by the Institute of Chartered Accountants of India.

    a) Premium for goodwill paid privately.
    b) Premium for goodwill paid (in cash or kind) and retained in the business.
    c) Premium for goodwill paid and withdrawn by the old partners.
    d) When the incoming partner cannot bring premium for goodwill.
    e) When a loan account is raised in the name of the incoming partner.
    f) Hidden goodwill.
    g) When the incoming partner brings personal goodwill into the business.
    h) When goodwill appears in the old Balance Sheet and the incoming partner pays premium for goodwill or pays partly the premium for goodwill.

(v) Preparation of Revaluation Account or Memorandum Revaluation Account.

    a) Preparation of a Revaluation Account where changes in the values of assets and liabilities are reflected in the new Balance Sheet after reconstitution of a partnership firm.
    b) Preparation of a Memorandum Revaluation Account where changes in the values of assets and liabilities are not reflected in the new Balance Sheet after reconstitution of a partnership firm.

(vi) Accounting treatment of accumulated profits and losses and Joint Life Policy.
Only the application (not the accounting treatment)of Joint Life Policy needs to be covered.

(vii) Adjustment of Capitals.
Problems pertaining to capital adjustments.

(viii) Retirement and death of a partner.

    a) Adjustment with regard to goodwill.
    b) Adjustment with regard to undistributed profits and losses.
    c) Adjustment with regard to joint life policy.
    d) Adjustment with regard to share of profits from the date of the last Balance Sheet to the date of retirement or death (on the basis of time or turnover).

(ix) Preparation of Revaluation Account or Memorandum Revaluation Account on retirement or death of a partner and construction of loan account and adjustment of capital as per new ratio.
Preparation of Revaluation Account or Memorandum Revaluation Account on retirement and death of a partner and construction of loan account and executor's account and adjustment of capital as per new profit and loss sharing ratio with or without the use of current account .

(x) Dissolution.

    (a) Meaning of dissolution, modes of dissolution, modes of settlement of accounts.
    (b) Preparation of Realization Account.
    (c) Treatment of undistributed profits and losses and Joint Life Policy.
    (d) Preparation of Cash / Bank Account.
    (e) Where at least one partner is insolvent Application of Garner Vs Murray.(With reference to fixed and fluctuating capital).
    (f) Where all partners are insolvent.

NOTE:

  • When an asset or a liability is taken to the realization account any corresponding related fund or reserve is also transferred to realization account and not to capital account.
  • When accounts are prepared on a fixed basis partners current account balances are to be transferred to capital account. No adjustments are required to be passed through current account.
  • When a question on insolvency of a partner is silent, then Garner Vs Murray is always to be applied.
  • When Garner Vs Murray is being used and a solvent partners capital account shows a debit balance, he does not bring in his share of loss on realization in cash
    and does not bear the deficiency of insolvent partner/ partners.
  • Where all the partners are solvent or any one insolvent, the loan from any solvent partner to the firm or taken from the firm is to be paid first in cash/Bank.
  • Admission cum retirement, amalgamation of firms and conversion/sale to a company together with piecemeal distribution not required.
  • Bank overdraft is not to be transferred to realization account but bank loan must be transferred to realization account.

6. Joint Stock Company Accounts

A. Issue of Shares.
Application of problems on issue of shares.
(a) Issue of shares at par, premium or at discount under Companies Act.
(b) Issue of shares for considerations other than cash:

  • To promoters.
  • To underwriters.
  • To vendors.
(c) Calls in arrears, calls in advance and interest thereon including the preparation of ledger accounts.
(d) Over and undersubscription (including prorata allotment).
NOTE: In prorata allotment when shares are issued at a premium, excess money received on application will first be adjusted towards the share capital. Any excess thereon will be utilized towards the securities premium.
(e) Forfeiture and reissue of shares.
Self explanatory.

NOTE: Issue of bonus and rights shares, private placement of shares, sweat equity shares, employees stock option scheme, reservations for small individual participants and minimum tradable lots are not required.

B. Issue of Debentures
Application of problems on issue of debentures – at par, at discount or at premium.
Application of problems on issue of debentures to include:
(a) Issue of debentures at par, premium or at discount under Companies Act.
(b) Interest on debentures.
(c) Writing off discount on issue of debentures.
(d) Accounting entries at the time of issue when debentures are redeemable at premium.
(e) Issue of debentures as collateral security for a loan.

  • To promoters.
  • To underwriters.
  • To vendors
(f) Issue of debentures for considerations other than cash.

NOTE:
Premium on the redemption of debentures to be recorded under the sub-head ‘Provisions’.
Redemption of debentures with or without sinking funds are excluded.

C. Final Accounts of Companies
Application of Schedule VI of Companies Act including Profit and Loss Appropriation Account of companies.
Application of problems.

  • Schedule VI Part I under Companies Act - Preparation of a company Balance Sheet. (Horizontal/Vertical Form) – Major Heads only.
  • Schedule VI Part II under Companies Act - preparation of a company Profit & Loss Account and Profit & Loss Appropriation Account.
    Preparation of Final Accounts of a company from a trial balance with or without adjustments.
NOTE:
Managerial remuneration and taxation are not required.
Debit balance of profit and loss account are to be shown in the asset side of balance sheet.
Calls in advance is to be taken as a current liability.

7. Cash Flow Statement and Ratio Analysis

(i) Meaning, importance and preparation of a Cash Flow Statement.
NOTE: Based on Accounting Standard – 3 (revised) issued by the Institute of Chartered Accountants of India.

(ii) Calculation of net cash flows from operating activities based on Indirect Method only.
Preparation of a Cash Flow Statement from two consecutive years’ Balance Sheet with or without adjustments.
NOTE: Any adjustment or an item in the Balance Sheet relating to issue of bonus shares, Foreign Currency Cash Flows; Extraordinary items; Investment in Subsidiaries, Associates and Joint Ventures; Acquisitions and Disposals of Subsidiaries and other Business Units; and Non Cash Transactions are not required. Redemption of preference shares and debentures with or without sinking funds are excluded.

(iii) Preparation of Cash Flow Statement on basis of operating, investing and financing activities.
The following items are to be taken when calculating net cash flows from financing activities:

  • Issue of shares and debentures at a premium.
  • Interest paid on debentures and public deposits.
  • Cash proceeds from public deposits.
  • Repayment of bank loan.
  • Share issue expenses paid off.
The following items are to be taken when calculating net cash flows from investing activities:
  • Cash purchase of fixed assets.
  • Cash sale of fixed assets.
  • Purchase of shares or debentures or marketable securities or long term investments of other companies.
  • Sale of shares or debentures or marketable securities or long term investments of other companies.
  • Cash advances and loans made to third parties of other enterprises.
  • Cash receipts from the repayment of advances and loans made to third parties of other enterprises.

(iv) Ratio Analysis.
Meaning, advantages and limitations of ratio analysis.

(v) Application of ratio analysis including calculations of various ratios (excluding interpretation, analysis, comparisons, conclusions and the preparation of Trading, Profit & Loss Account and Balance Sheet).
(a) Balance Sheet Ratios:

  1. Proprietary ratio


  2. Current ratio


  3. Quick/Liquid/Acid test ratio


[Note: Shareholders’ fund is equal to Equity share capital + Preference share capital + Reserves and Surplus – Fictitious assets.]

  1. Total assets to debt ratio


  2. Debt-equity ratio
(b) Revenue Statement Ratios:
  1. Gross profit ratio

  2. Net profit ratio

  3. ratio Operating


  4. Operating Profit Ratio

  5. Earning per share
NOTE: [Financial expenses and non-operating expenses are to be ignored.]
Operating expenses = Administrative expenses + Selling and Distribution expenses.

(c) Balance Sheet and Revenue Statement Ratios:

  1. Debtors turnover ratio


  2. Creditors turnover ratio


  3. Working capital turnover ratio

  4. Stock turnover ratio

NOTE:
Net = Gross – returns


Working capital = current assets – current liabilities

Current assets = cash in hand, cash at bank, marketable securities, short-term investments, sundry debtors, bills receivable, accrued income, prepaid expenses, stock in trade.

Current liabilities = Sundry creditor, bills payable, liability for taxes, outstanding expenses, income received in advance, provision for taxation, proposed dividend, bank overdraft.

Cost of Goods sold = opening stock plus net purchases plus direct expenses minus closing stock.

OR

Cost of Goods sold = Net sales minus gross profit.

Operating ratio = 100 – operating profit ratio.

Operating profit = Gross profit minus Administrative expenses minus selling and Distribution expenses.

OR

Operating profit = Net profit plus non-operating expenses minus non-operating incomes.

PAT = Net profit after taxation minus preference dividend.

 
 

Aims:

  1. To enable candidates to know the basic structure of a business organisation.
  2. To acquaint candidates with the various functions conducted therein.
  3. To provide preliminary practice on the function al aspects of an office organisation.
  4. To provide candidates with a preliminary idea of an office environment.

CLASS XI

There will be one paper of 3 hours duration of 100 marks and divided into 2 parts.
Part 1 (30 marks) will consist of compulsory short answer questions testing knowledge, application and skills relating to elementary / fundamental aspects of the entire syllabus.
Part 2 (70 marks) will consist of seven questions out of which the candidate will be required to answer five questions, each carrying 14 marks.

1. The Office

Specific Objectives - At the end of this section pupils should be able to -

  • understand the process of evolution of the modern office.
  • describe the functions of an office.
  • enlist various services essential for the functioning of an office.
  • differentiate between centralisation and decentralisation of office services.
  • identify and define functions of various departments of a large office.
(i) Meaning and evolution of the modern office.
(ii) Functions of an office.
(iii) Office services - secretarial support, record management, distribution of mail, control of stationery, reception, operation of switchboards, duplicating and copying, etc.
(iv) Centralisation or decentralisation of office services.
(v) Departments in a large office: production; personnel; marketing; finance and accounting; secretarial.
(vi) Role of the office as an information processing centre.
(vii) Office Manager: functions and his qualities.

2. Office Accommodation and Environment

Specific Objectives: At the end of this section pupils should be able to -

  • explain the factors to be considered at the time of selecting an office accommodation.
  • identify the principles and purposes of an office layout.
  • describe the advantages and defects of open and private office layouts.
  • describe the special features of landscaped office.
  • state the environmental factors that affect the working in an office.
(i) Meaning of office accommodation.
(ii) Principles and factors involved in the selection of office site.
(iii) Office layout: meaning; purposes; principles; steps; types.
(iv) Physical factors: outline of the effects of - lighting, ventilation, noise, cleanliness, etc. on the office work.

3. Organising an Office

Specific Objectives: at the end of this section, pupils should be able to –

  • define the term organisation.
  • explain the principles of organisation.
  • state the steps in organising an office.
  • explain the meaning of departmentalisation.
  • identify the basis of methods of departmentalisation.
  • identify the types of organisation and explain their features.
  • compare and contrast the types of organisations.
(i) Meaning and importance of organisation.
(ii) Steps in organisation of office.
(iii) Principles of organisation.
(iv) Types of organisations - line, functional, line and staff, committee.
(v) Features of the above organisation structures.
(vi) Meaning of departmentalisation.
(vii)Methods of departmentalisation (function, territory, process, production or service).
(viii)Visual presentation of - organisation; structure (organisation chart - meaning, purpose and type of organisation charts).

4. Authority and Responsibility

Specific Objectives: At the end of this section pupils should be able to -

  • define the terms Authority, Responsibility and Accountability.
  • distinguish between the above terms.
  • state the sources of authority.
  • explain the meaning of and principles of delegation of authority.
  • distinguish between the centralisation and decentralisation of authority.
  • explain the meaning and purposes of office manuals.
(i) Meaning of - authority; responsibility; accountability and their inter-relationship.
(ii) Sources of authority.
(iii) Meaning of delegation.
(iv) Principles/rules of delegation of authority.
(v) Distinction between centralisation and decentralisation of authority.
(vi) Office manuals.

5. Office Records Management

Specific Objectives: At the end of this section pupils should be able to -

  • identify the major features of a good records management.
  • identify and compare the different methods of main filing classification.
  • describe different types of filing and indexing equipment.
  • appreciate the concept of electronic filing.
  • describe the different types of micro form storage.
  • explain the main features of microfilm equipment.
  • outline a procedure for filing.
  • explain follow-up procedures and absent file records.
  • explain the need for retention and destruction policies for records.
(i) Meaning of Records Management and its essential features.
(ii) Filing - characteristics of a good filing system; classification of records for filing (alphabetical, numerical, etc.); modern methods - vertical, horizontal, lateral and suspension; equipment; types of files; filing routine; disposal of obsolete documents.
(iii) Indexing: importance; types - page index, card index, strip index, rotary index.
(iv) Micro-filing: merits and demerits; types - roll film, fiche, jackets, etc.
(v) Meaning of electronic filing.

6. Office Reprography

Specific Objectives: At the end of this section the pupils should be able to -

  • distinguish between different types of reprographic processes.
  • describe different duplication processes.
  • describe different types of copiers.
  • suggest appropriate reprographic equipment for different tasks.
  • explain the benefits of in-house printing.
  • describe the features of different types of printing.
  • explain the uses of carbon paper and other methods of carbon copying.
  • explain the features and uses of printing typewriters.
(i) Methods of duplicating: spirits or hectograph; stencil or mimeograph/ink; offset lithography.
(ii) Types of photocopying; reflex, diazo, electrostatic, dual spectrum etc.
(iii) Printing: considerations for the choice between in-house and outside printing; offset-printing and letter press printing.
(iv) Typewriters: manual; electric; automatic; electronic.

7. Office Automation

Specific Objectives: At the end of this section pupils should be able to -

  • explain the difference between office automation and office mechanisation.
  • explain the benefits and difficulties of office automation.
  • explain the use of computers, calculators, adding machines in office automation.
  • appreciate the terms used in automation.

(i) Meaning of office automation.
(ii) Merits and demerits of office automation.
(iii) Uses of - adding and listing machines; calculators; cash registers; computers.
(iv) Components of computers for processing data: input units; central processing unit; output units; backing store.
(v) Elementary knowledge of the types of computers: main frame, mini, micro.

CLASS XII

There will be one paper of 3 hours duration of 100 marks and divided into 2 parts.
Part 1 (30 marks) will consist of compulsory short answer questions testing knowledge, application and skills relating to elementary / fundamental aspects of the entire syllabus.
Part 2 (70 marks) will consist of seven questions out of which the candidate will be required to answer five questions, each carrying 14 marks.

1. Staff

Specific Objectives - At the end of this section pupils should be able to-

  • explain staff selection procedures.
  • state the importance and methods of staff training.
  • describe the indicators of low morale and the methods of raising morale.
  • describe different types of staff remuneration methods.
  • distinguish between different leadership styles.
  • identify the purpose, merits and methods of staff appraisal.
  • explain the need for promotion policy for staff.
  • understand the meaning and importance of staff promotion and transfer.
  • enlist the grounds for staff dismissal.

(i) Staff recruitment: meaning; sources - internal, external.
(ii) Staff selection procedures.
(iii) Staff training: importance; methods - on the job, off the job; preparation of the training programme.
(iv) Staff morale: meaning; importance of morale; factors affecting morale; methods of raising morale; indicators of low morale; importance of team work.
(v) Staff remuneration: methods - time rate, wage rate, incentive methods (Halsey, Rowan plan), wage records (time card, attendance book, pay slip, pay roll, etc.).
(vi) Staff motivation: meaning and importance; factors of motivation; Maslow’s theory of the hierarchy of human needs.
(vii) Staff leadership: leadership qualities; leadership styles.
(viii)Staff appraisal: purpose; merits; methods - merit grading, interviewing, reporting.
(ix) Staff promotion and transfer: meaning and importance; basis (seniority vs. ability); need for promotion policy; process for selection; types of transfer.
(x) Staff dismissal : grounds for dismissal; procedure.

2. Office Communication

Specific Objectives: At the end of this section pupils should be able to -

  • explain the need for efficient communication.
  • state the barriers to effective communication.
  • identify the oral and written methods of communication.
  • describe the procedures of handling people at the Reception.
  • identify the appropriate use of internal and external communication methods in given circumstances.
  • explain the post office service for mail and telecommunication services for telephone, telex, telegram, tele-fax etc.
  • describe the procedures of incoming and out going mail.
  • list and describe mail room machines and equipment.
  • compose relevant correspondence from available data - letters, memos, etc.
  • describe the standard telephone and switchboard equipment.
  • outline recent advances in telephone services.
  • explain the arrangements to be made by a secretary for a meeting.
  • state the essentials of a meeting.
  • identify the different kinds of meetings from given details.
  • prepare reports and minutes of a meeting from given notes.
  • explain the role of the chairman.
  • explain the procedures and common terms used in meetings.
  • explain the use of graphic methods of communication.
  • construct a table, graph, from given data.
  • interpret the graphs or diagrams.

(i) Meaning and importance of communication and essentials of effective communication.

(ii) Methods: oral, written and visual - face to face communication; reception - qualities of a receptionist, procedure of reception, organisation of reception area; interviewing types - appraisal, disciplinary, recruitment, telephone - qualities of an efficient telephone operator, procedure rules for internal and external services, types of calls, modern developments in telephone communication, telephone switch board equipment, others - telex, fax, tele-write, video conferencing, cellular phones, cordless phones, loudspeaking, tele-text, staff locating systems - public address systems, bells and buzzers, lighted signals, wireless signals;written correspondence - essentials of a good business letter, structure of a letter, types of letters (only the following types: application for job, enquiry, quotation, order, complaints, drafting of interview letter, offer of appointment), letter for quick communication (standard letters, blitz reply, monogram, D.O. letters, return memo set), -internal written communication (memos, circulars, office orders), telegrams (types of telegrams, telegraphic addresses, essentials of a telegram, drafting a telegram); report writing - essentials of a good reporter, format simple informal reports (exclude company reports); meetings - meaning, requisites of a valid meeting, types (statutory, annual, extraordinary, board), secretary's duties, preparation of notices, agenda, chairman's role and power, preparation of minutes from given data only, terms used and procedures of meetings; motions; resolutions; adjournment; postponement; voting; proxy; point of order, etc.

(iii) Visual communication and its importance: graphs - nature and types (Z-graph, line-graph, bar graphs); diagrams - nature and types (pictogram, pie, histogram); tables - nature and types, presentation of specific data in tabular form.

(iv) Organisation of mailroom in a large office: handling of incoming and outgoing mail; mechanical aids used; post office services used.

 
 
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