Welcome to the

B124 introductory tutorial

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Agenda

• Welcome and introductions – tutor led.(5 mins)

• Two important arithmetic skills – (10 mins)
• Expectations and concerns in studying
accounting on B124.(10 mins)
• The importance of accounting for any
business.(5 mins)
• Unit 1 discussion – most useful learning and
most surprising learning.(15 mins)
• Unit 1 questions as model for use of Tutor
Group Forums (TGFs).(10 mins)
• Review and looking forward – Day school 1 &
TMA 1.(5 mins).

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Learning outcomes
Students will:
• Appreciate the importance of adobe
connect (online tutorials) as an
individual and social learning tool
• Demonstrate ability to apply two
arithmetic skills
• Demonstrate understanding of the
content and skills of Unit 1
• Gain more insight into the structure
and assessment of B124 and the
resources available to support their
learning.
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The Module Website

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The Module Website

The study planner on the B124 website is

the focal point for organising your study and
contains a number of online activities
designed to deepen your understanding of
module concepts.

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The Module Website
The study planner on the B124 website is the focal point for organising
your study and contains a number of online activities designed to deepen
your understanding of module concepts.

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The Module Website
The study planner on the B124 website is the focal
point for organising your study and contains a
number of online activities designed to deepen your
understanding of module concepts.

Have you found

1.Your tutor group forum?

2.The TMAs?
3.Week 1 activity D?
4.The assessment roadmap?
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5.Video resources eg. The accounting equation

2. Two important arithmetic skills in
accounting
1. Percentage changes

• Percentages (‘per cent’ means ‘parts of a

hundred’) express fractions (such as 1/2) or
decimals (such as 0.5) in a standard, simple
way, such as 50% (50 parts of a hundred).
• Two financial figures (numbers) from two
different businesses, such as profit or sales,
can be more easily compared if they are
put into percentages. 10
1. Percentage changes continued

• Percentages are useful to look at how financial

figures change over time. If the price of a new
laptop has changed from £375 in year 1 to £450
in year 2, the price has risen by £75.
• But what is the significance of the increase?
An increase in £75 in the price of an expensive
new car is much less significant than in the price
of a cheap laptop. Using percentages can make
this much clearer.

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1. Method for working out % changes

First work out the increase in pounds

£450 – £375 = £75.
Percentage changes are based on the starting
or old figure, so:
£75 / £375 x 100 = 20% or 0.2. (If the laptop
had fallen by £75 we would use the same
method to get a percentage decrease of -20%.)
The formula for working out percentage change
is thus:
((New figure – old figure) / old figure) x 100.
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1. Questions on % changes
a) The cost of a new car has increased from
£37,500 to £37,575. What is the percentage
increase in the cost?
b) A cost had fallen from £150 to £120. What is
the percentage decrease in the cost?
c) A price has fallen from £20 to £17. What is the
percentage decrease in the price?
d) The interest rate on a bank loan has increased
from 10% to 14%. What is the percentage
increase in the interest rate?
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1. Feedback

a) ((£37,575– £37,500) / £37,500) x 100% = 0.2%

b) ((£120 – £150) / £150) x 100% = - 20%

c) ((£17 – £20) / £20) x 100% = - 15%

d) ((14% – 10%) / 10%) x 100% = 40% (Not 4 % -

the interest rate has increased by 40%. It is
also correct to state that it has increased by 4
percentage points ) 14
2. Two important arithmetic skills in
accounting continued

2. Working out profit margins

• The relationship between sales and costs
(expenses) is a critical one in any business as it
determines the profit (or loss) that is made:
• Sales – costs = profit/(loss)
• The most important calculation that shows the
relationship between sales and costs as a
percentage is the profit margin (also known just
as ‘margin’ or ‘margin on sales’).
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2. Working out profit margins (margin on sales)
continued

In the profit margin, the profit element is shown as

the percentage of the sales value.

(Profit / Sales) x 100 (to bring it to a %)

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2. Questions on profit margins

a)A business earns £1,000 from sales of £10,000. What is its

profit margin?
b)A project generates a profit £4,020 on turnover of £80,400.
What is the margin on the project?
c)If total sales are £10,000 and total costs are £7,500 what is the
margin on sales?
d)An investor is considering two businesses in the same industry.
In the latest accounting period, a year, the first has generated a
profit of £107,000 from sales of £843,000. In the same period,
the second has incurred costs of £777,000 to generate turnover
of £875,000. Ignoring any other information, which business is
the investor likely to prefer? Why?

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2. Feedback

a) (£1,000 / £10,000) x 100% = 10%

b)(£4,020 / £80,400) x 100% = 5%
c)(£2,500 (from £10,000 - £7,500) / £10,000) x 100% = 25%
d)The first business has a profit margin of (£107,000 / £843,000)
x 100% = 13% (rounded off to a whole number percentage)
The second business has a profit margin of (£98,000 (from
£875,000 - £777,000) / £875,000) x 100% = 11% (rounded off to
a whole number percentage)
The investor is likely to prefer the first business as it has a profit
margin that is about 2 percentage points higher. (Not 2% higher
(the first business has a profit margin that is about 18% higher
((13% – 11% / 11%) x 100% = 18%)
3. Expectations and concerns about Level 1
Accounting Study

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3. Expectations and concerns about
Level 1 Accounting Study

What other numeracy is needed for B124?

What spreadsheet skills are needed for B124?

What is the best way to learn accounting?

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3. Expectations and concerns about
Level 1 Accounting Study

What is the language of accounting?

Type into the chatbox some accounting terms

that you have come across.

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3. Expectations and concerns about
Level 1 Accounting Study

Why is double-entry accounting so important?

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Why is double-entry accounting so
important?
• System of recording transactions in the accounts
accurately and methodically.

Why is this important?

Organisations need accurate financial information eg.
- how much they owe and are owed
- how much profit has been made

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3. Expectations and concerns about Level
1 Accounting Study

How is B124 assessed?

To pass you must achieve 40% overall and 35% in
the exam
Final module marks

TMA 01 10%
TMA 02 20%
TMA 03 20%
Examination (2 hours) 50%
Total 100%

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4. The importance of accounting for
business
Why is accounting so important in any business?

What is the difference between financial and

management accounting?

Why does a sole trader need both types of

accounting information?

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4. The importance of accounting for
business
Why is accounting so important in any business?

Please type in the chatbox.

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4. The importance of accounting for
business
Why is accounting so important in any business?

-To provide information for decision making

- Legal requirement
- To find out if they are making a profit or loss
- To keep track of how much they owe and are
owed.

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4. The importance of accounting for
business
What is the difference between financial and
management accounting?

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4. The importance of accounting for
business
Financial accounting is the production of
summarised financial statements by managers
and/or owners of a business. Such accounting
reports formally to all external stakeholders at least
once a year.

Management accounting is the production of

detailed, regular, ad hoc and up-to-date reports by
managers and/or owners of a business in order to
make effective business decisions and to properly
plan and control all business activities. 29
4. The importance of accounting for
business
Why does a sole trader need both types of
accounting information?

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5. What have I learned in Unit 1?
Students to share:
• Their most useful accounting learning so far?
• Their most surprising accounting learning so far?

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6. Asking and answering questions in
TGFs.

• Virtually all aspects of B124 - content, iCMAs,

website material, spreadsheets, progression
beyond B124 etc.

• TMAs must be student’s own work so TGFs

cannot be used to answer TMA questions.

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The Module Website
The study planner on the B124 website is the focal
point for organising your study and contains a
number of online activities designed to deepen your
understanding of module concepts.

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7. Review of session & looking forward

The importance of arithmetic skills in

accounting

1. Expectations and concerns of studying

accounting

2. The importance of accounting for business

3. Useful and surprising learning in Unit 1.

4. The approach to effective TGFs in B124

5. The Day School and TMA 1

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See you soon…

• Thank you for attending

• We look forward to
seeing you again in our
next tutorial

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recording of the session
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