Myanmar DA Part II Module I cheat sheet

The accounting equation is Assets = Liabilities + Equity. Every transaction affects at least two elements and keeps the equation balanced.

Double-entry bookkeeping records equal debits and credits for every transaction. A trial balance proves debit-credit equality, not the absence of errors.

Under accrual accounting, revenue is recognised when earned and expenses when incurred, not when cash is received or paid.

Straight-line depreciation = (cost - residual value) / useful life. Reducing-balance depreciation = carrying amount × depreciation rate.

Inventory is measured at the lower of cost and net realisable value. Cost includes purchase price, conversion costs and other costs to bring inventory to its present location and condition.

Bank reconciliation: adjusted bank statement balance = statement balance + deposits in transit - outstanding cheques ± bank errors. Adjusted cash book balance = cash book balance + bank collections and interest - bank charges and dishonoured cheques ± book errors.

A provision is recognised when a present obligation exists, an outflow is probable and a reliable estimate can be made. A contingent liability is disclosed unless the possibility of outflow is remote.

Closing entries transfer temporary accounts such as revenue, expenses and drawings to equity or retained earnings. Permanent accounts such as assets, liabilities and equity carry forward.

Costs can be classified by behaviour as fixed, variable or mixed; by function as product or period; and by traceability as direct or indirect.

High-low method: variable cost per unit = (highest total cost - lowest total cost) / (highest activity - lowest activity). Fixed cost = total cost - variable cost per unit × activity level.

Contribution margin = sales - variable costs. Contribution margin ratio = contribution margin / sales. Break-even units = fixed costs / contribution per unit. Break-even sales = fixed costs / contribution margin ratio.

Margin of safety = actual or budgeted sales - break-even sales. Margin of safety ratio = margin of safety / actual or budgeted sales.

Target profit in units = (fixed costs + target profit) / contribution per unit. Target profit in sales = (fixed costs + target profit) / contribution margin ratio.

Overhead absorption rate = budgeted overhead / budgeted absorption base. Under- or over-absorption = actual overhead - overhead absorbed.

Relevant costs are future, incremental cash costs that differ between alternatives. Sunk costs and allocated common costs that do not change are irrelevant.

Material price variance = (standard price - actual price) × actual quantity purchased. Material usage variance = (standard quantity for actual output - actual quantity used) × standard price.

The audit objective is to obtain reasonable assurance that the financial statements are free from material misstatement, whether due to fraud or error. An audit does not provide absolute assurance.

Audit risk = inherent risk × control risk × detection risk. Detection risk is reduced by designing effective substantive procedures.

Materiality is the amount of misstatement that could influence the economic decisions of users. Performance materiality is set below overall materiality to reduce the probability that uncorrected misstatements exceed materiality.

Audit evidence must be sufficient in quantity and appropriate in relevance and reliability. External, original and independently obtained evidence is generally more reliable than internal or copied evidence.

Transaction assertions include occurrence, completeness, accuracy, cut-off and classification. Balance assertions include existence, rights and obligations, completeness, valuation and allocation, and presentation and disclosure.

The auditor must be independent in mind and appearance. Financial interests, close family employment and business relationships with the client can impair independence.

Going concern: the auditor evaluates management's assessment of the entity's ability to continue for at least twelve months from the financial statement date.

Audit opinions are unmodified or modified. Modified opinions are qualified, adverse or disclaimer, depending on whether the matter is material and pervasive.

Essentials of a valid contract include offer, acceptance, consideration, capacity, free consent and lawful object. A void contract has no legal effect; a voidable contract may be avoided by the affected party.

Under the Myanmar Companies Law 2017, a registered company has separate legal personality, limited liability for shareholders and is incorporated through DICA.

Myanmar's income tax year runs from 1 April to 31 March. The Internal Revenue Department administers income tax, and taxpayers must register and file returns as prescribed.

Resident taxpayers are generally taxed on worldwide income, while non-resident taxpayers are generally taxed on Myanmar-source income under Myanmar income tax rules.

Commercial tax is an indirect tax on the sale and import of goods and services. Specific goods tax applies to designated goods such as tobacco and alcohol.

Tax avoidance uses lawful arrangements to reduce tax. Tax evasion involves illegal concealment, false reporting or non-disclosure and attracts penalties.

A partnership generally involves mutual agency and unlimited liability of partners, unless a limited liability structure is used.

Under sale of goods law, a condition is essential to the main purpose of the contract, while a warranty is collateral. Breach of a condition can allow rejection; breach of a warranty gives a right to damages.

Simple interest: I = P × r × t, where P is principal, r is annual rate and t is time in years. Amount A = P(1 + rt).

Compound amount: A = P(1 + i)^n, where i is the interest rate per period and n is the number of periods.

Present value: PV = FV / (1 + i)^n. This discounts a future amount to its value today.

Present value of an ordinary annuity: PV = PMT × [1 - (1 + i)^-n] / i.

Percentage change = (new value - old value) / old value × 100. An increase gives a positive value; a decrease gives a negative value.

Markup on cost = profit / cost × 100. Margin on selling price = profit / selling price × 100. A 25% markup on cost equals a 20% margin on selling price.

Straight-line equation: y = mx + c, where m is the slope and c is the y-intercept. Slope = change in y / change in x.

Ratio and proportion: if a:b = c:d, then ad = bc. Ratios compare quantities and can be scaled by multiplying or dividing all terms by the same number.

Mean = sum of values / number of values. The median is the middle value when data are ordered. The mode is the most frequent value. The mean is sensitive to outliers.

Sample variance: s² = Σ(x - x̄)² / (n - 1). Standard deviation is the positive square root of variance.

Coefficient of variation = standard deviation / mean × 100. It compares relative dispersion between data sets with different units or means.

For a normal distribution, about 68% of values lie within one standard deviation of the mean, 95% within two and 99.7% within three.

Standard normal score: z = (x - μ) / σ. It converts a value to the number of standard deviations from the mean.

Correlation coefficient r ranges from -1 to +1. It measures the strength and direction of linear association; it does not prove causation.

Regression line: y = a + bx, where b = r × (sy / sx) and a = ȳ - b × x̄.

Addition rule: P(A or B) = P(A) + P(B) - P(A and B). For independent events, P(A and B) = P(A) × P(B).

Demand curves generally slope downward: as price rises, quantity demanded falls, other factors unchanged. Supply curves generally slope upward. Equilibrium occurs where quantity demanded equals quantity supplied.

Price elasticity of demand = percentage change in quantity demanded / percentage change in price. Demand is elastic if the absolute value exceeds 1 and inelastic if it is below 1.

Gross domestic product = consumption + investment + government spending + net exports. Nominal GDP uses current prices; real GDP adjusts for inflation.

Inflation reduces the purchasing power of money. The consumer price index measures changes in the cost of a representative basket of goods and services.

Opportunity cost is the value of the next best alternative forgone. Scarcity forces trade-offs and makes opportunity cost central to economic decisions.

Market structures include perfect competition, monopolistic competition, oligopoly and monopoly. They differ in number of firms, product differentiation, barriers to entry and price control.

Fiscal policy uses government spending and taxation. Monetary policy uses interest rates, money supply and credit conditions, usually through a central bank.

The balance of payments records a country's transactions with the rest of the world. Its main components are the current account and the capital and financial accounts.

In spreadsheets, A1 is a relative reference that changes when copied. $A$1 is an absolute reference that remains fixed. Mixed references fix either the row or the column.

Common spreadsheet functions include =SUM(range), =AVERAGE(range), =IF(condition, value_if_true, value_if_false) and =VLOOKUP(value, table, column, FALSE).

A primary key uniquely identifies each record in a database table and cannot contain duplicates or nulls. A foreign key links to a primary key in another table.

IT general controls include access controls, segregation of duties, change management, backup and disaster recovery. These controls protect the reliability of application controls.

The CIA triad consists of confidentiality, integrity and availability. These are core objectives of information security.

Cloud service models are IaaS (infrastructure), PaaS (platform) and SaaS (software). Customer management responsibility decreases from IaaS to SaaS.

The 7Cs of business communication are clear, concise, concrete, correct, coherent, complete and courteous.

A formal business report typically contains a title page, executive summary, introduction, body, conclusion and recommendations.