COURSE SYLLABUS DETAILS

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Subject Code:
AC2 (Partnership and Corporation)
Subject Description:
This course deals with the concepts and principles and the rules and procedures that Partnership and Corporate type of
business adhere to in its operations, in particular, its formation; the recording of financial transactions; capitalization and
profits distribution; dissolution and liquidation of a partnership business; and the preparation of financial statements for
the benefit of the various users of financial statements in the highest degree of ethical standard and in full adherence to
the fundamental principles of sound accounting practice.
Subject Objectives:
The students are expected to:
1. Recognize the value of accounting in partnership and corporation forms of business organization.
2. Possess deeper and more reflective understanding of the accounting concepts, principles and processes as applied to
partnership and corporation.
3. Develop the capacity for learning new accounting knowledge and skills.
4. Analyse, evaluate and solve the accounting problems peculiar to a partnership and a corporation.
Subject Coverage:
1. Orientation and Overview
7. ACCOUNTING FOR A CORPORATION
2. NATURE OF A PARTNERSHIP
7.1. Accounting Problems Peculiar to a Corporation
2.1. Definition of a Partnership
7.2. Organization Expenses
2.2. Elements of a Partnership
7.3. Share Capital Transactions
2.3. Characteristics of a Partnership
7.4. Share Capital Issuance for Non-Cash
2.4. Advantages/Disadvantages of a Partnership
Considerations
2.5. Kinds of a Partnership
7.5. Share Capital Issuance for Payment of Liability
2.6. Kinds of Partner
7.6. Share Capital Issuance for Services Rendered
2.7. Basic Rights of a Partner
7.7. Delinquent Share Capital Subscription
2.8. Articles of Co-Partnership
7.8. Share Capital from Donation
2.9. Registration Requirements
8. TREASURY SHARES
3. ACCOUNTING FOR A PARTNERSHIP
8.1. Definition and Nature of Treasury Shares
3.1. Accounting Problems Peculiar to a Partnership
8.2. Methods of Accounting for Treasury Shares
3.2. Pro-forma Statement of Partners Equity
8.3. Accounting Problems Relating to Treasury
3.3. Different Ways of Forming a Partnership
Shares
3.4. Computation of the Agreed Total Capital
8.4. Two Methods of Accounting for Treasury
3.5. Determination of Goodwill
Shares
3.6. Capital Interest vs. Profit & Loss Sharing Ratio
8.5. Acquisition of Treasury Shares by Purchase
4. DISTRIBUTION OF PROFITS OR LOSSES
8.6. Acquisition of Treasury Shares thru Donation
4.1. Partnership Operation
8.7. Acquisition thru Payment of a Debtor4.2. Division of Profits or Losses
Shareholder
4.3. Rules in the Division of Profits or Losses
8.8. Reissue of Treasury Shares
4.4. Methods of Dividing Profits and Losses
8.9. Retirement of Treasury Shares
4.5. Equity in Partnership Assets and Share in Profits
8.10. Balance Sheet Presentation of Treasury Shares
PRELIM EXAMINATION
9. ACCOUNTING FOR DIVIDENDS
9.1. Definition of Dividends
5. PARTNERSHIP DISSOLUTION
9.2. Types of Dividends
5.1. Nature of Dissolution
9.3. Dividends Out of Earnings
5.2. Circumstances Resulting in Dissolution
9.4. Three Significant Dates Pertaining to
5.3. Dissolution by Act of the Partners
Dividends
5.4. Dissolution by Operation of Law
9.5. Forms of Dividends
5.5. Dissolution by Judicial Decree
9.6. Cash Dividends vs. Property Dividends
5.6. Admission by Purchase
9.7. Scrip Dividends vs. Stock Dividends
5.7. Admission by Investment
9.8. Recording Stock Dividends
5.8. Comparison of the Goodwill Method and Bonus
9.9. Stock Dividends vs. Cash Dividends
Method
9.10.
Liquidating Dividends
5.9. Dissolution by Withdrawal or Retirement of a
10.
ACCOUNTING FOR RETAINED EARNINGS
Partner
10.1. Definition of Retained Earnings
6. PARTNERSHIP LIQUIDATION
10.2. Factors Affecting Retained Earnings
6.1. Realization vs. Liquidation
10.3. Periodic Net Income or Net Loss
6.2. Lump-Sum Liquidation
10.4. Dividends Out of Earnings
6.3. Instalment Liquidation
10.5. Adjustment of Prior Years Profits
6.4. Legal Provisions in Liquidation
10.6. Recapitalization vs. Share Split
6.5. Accounting Procedures in Lump-Sum
10.7. Conversion of Preference Share Capital into
Liquidation
Ordinary Share Capital
6.6. Accounting Procedures in Liquidation by
10.8. Quasi-Reorganization
Instalment
10.9. Appropriation of Retained Earnings
6.7. Cash Priority Program
10.10. Statement of Retained Earnings
MIDTERM EXAMINATION
FINAL EXAMINATION

5. Subject Outcomes
A student completing this course should be at the minimum be able to:
A student completing this course should be able to:
1. Define partnership organization and describe its distinction from a sole proprietorship
2. Define a corporation and describe its distinction from a sole proprietorship and a partnership.
3. Describe the advantages and disadvantages between and among the three business organization types.
4. Enumerate and describe the characteristics of the partnership
5. Describe and discuss the classification of partnerships and kinds of partners.
6. Discuss the formation of the partnerships and enumerate the requirements in forming a partnership
7. Discuss the valuation of investments by partners and be able to analyse the adjustments prior to partnership
formation
8. Analyse and journalize opening entries of a partnership upon formation under various circumstances
9. Distinguish the partners capital account vis--vis sole proprietorship
10. Describe and discuss the governing principle and law on partnership profits or losses distribution.
11. Describe the factors that are taken into consideration in arriving at a plan for dividing profits or losses
12. Prepare the basic financial statements in accordance with the new accounting standards
13. Define the terms in partnership dissolution, enumerate and describe the causes of partnership dissolution.
14. Determine the capital contribution of old and new partners under the different scenario in admitting a new
partner due to dissolution.
15. Determine the capital to be returned or given to retiring, withdrawing or to heirs of deceased partner.
16. Enumerate the procedures in the incorporation process of a partnership
17. Define partnership liquidation and distinguish it from dissolution
18. Describe the circumstance under which the partnership is to be liquidated
19. Describe or discuss the rules in settling of partnership accounts after dissolution
20. Describe the methods of partnership liquidation under the different scenarios of partners financial status
21. Prepare Statement of Partnership Liquidation under the Lump-sum method and the Installment method
22. Journalize the liquidation and distribution of residual partnership assets after liquidation
23. Discuss the cash priority program and prepare a Schedule of Safe Payment
24. Enumerates the attributes of a corporation
25. Discuss the advantages and disadvantages of a corporation
26. Describe and discuss the classes of corporation
27. Familiarize with the steps in the creation of a corporation
28. Discuss and articulate the contents and purposes of the articles of incorporation and by-laws
29. Enumerate the components of a corporation
30. Get acquainted with and discuss the different class of share capital and the rule on minimum share
subscription and paid-up capital
31. Describe the corporate organizational structure
32. Describe the various corporate books and records and its use and functions
33. Describe and discuss the legal capital concept
34. Describe the account titles related to share capital
35. Journalize share capital transactions
a. Issuance for cash of par and no-par shares
b. Issuance in exchange for non-cash assets of par and no-par shares
c. Subscribed share capital
d. Treasury shares
36. Define Accumulated Profits and Losses or Retained Earnings
37. Describe and discuss the different types of dividends
38. Discuss the effects of dividends and stock splits
39. Discuss and determine dividends of corporations with both on preference and ordinary shares
40. Describe the restrictions on retained earnings
41. Prepare the Statement of Retained Earnings and Statement of Shareholders Equity
42. Determine the book value per share
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Textbook:
Ballada, Win Lu. (2015) Partnership and Corporation Accounting, 2015 Issue, 19th Edition. Manila: Made Easy Books.

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Subject Evaluation:
The minimum requirement for a passing grade is 75%, final grade from the following:
Prelim Period

Midterm Period

Final Period
MG

CP

TE

2/3

1/3

Formative
and
Summative
Assessment
Note:

Exam

PG

CP

TE

2/3

1/3

Formative
and
Summative
Assessment

IMG

FG

IMG

PG

CP

TE

2/3

1/3

2/3

1/3

Exam

Formative
and
Summative
Assessment

Exam

CP : Class discussion, Quizzes, Seat Work, Home Work, etc. (minimum of 4 assessment per term)

Aside from academic deficiency, other grounds for a failing grade are:
Any form of cheating
More than 20% of the total number of meetings missed in a semester
Failure to take the final examination with no valid excuse

IFG

IFG

MG

2/3

1/3