Accounting and mathematics are closely related. There is little mathematics content that a profound relationship exists between mathematics and accounting. There is, however, a limited understanding of the nature of this relationship and the extent to which mathematics influences the teaching and learning of accounting. Accounting scholars perform a variety of calculations in accounting courses, making mathematics integral to the successful study of accounting. This investigative study is hinged on transdisciplinary relationship between mathematics and accounting in an undergraduate teacher education degree. The purpose of this article was to identify the mathematics topics required for the study of accounting in a Bachelor of Education (BEd) degree curriculum. A detailed analysis of the BEd Accounting course content for Accounting I, II and III regarding mathematical topics students encounter in their accounting modules was undertaken. A content analysis in the form documents was employed. Accounting course packs were analysed for mathematics required in a BEd curriculum. The analysis of accounting course packs revealed a range of mathematical content required for accounting. This finding confirmed the mathematical content needed for accounting, as identified under literature review. This article concludes with the implications for basic education, higher education, textbook writers, curriculum specialists and international policymakers.

Mathematics is related to accounting but not as interlinked as people may believe or sometimes, that you should have a lot maths to take accounting (Babalola & Abiola

The aim of this study was to investigate the transdisciplinary relationship between mathematics and accounting in a BEd curriculum at the HEI, with the aim of informing higher education pedagogy as it relates to teaching and learning in accounting.

What mathematics topics are required for the study of accounting in a BEd degree?

The disciplines of Mathematics and Accounting are discussed under two sub-categories: philosophy and similarities and differences between the disciplines of Mathematics and Accounting.

The relationship between mathematics and accounting or bookkeeping is very old and the first published treatise on the double-entry principle appeared in 1494 in a book on mathematics by Luca Pacioli, entitled

The success in maintaining the two-sided accounting debits and credits, the double-entry principle, and the trial balance in both cases provide strong evidence that the formulation correctly captures the double-entry method in mathematical form. (p. 17)

In short, the double-entry principle means that the financial transaction contains two or more entries – flow of money from one account to one or more other accounts. For every debit (credit) entry there is a corresponding credit (debit) entry, and the value of debits must be equal to the value of credits. This ensures arithmetical accuracy of the recordings of financial transactions (Ellerman 2009; Haiden

Accounting requires thinking that is careful and logical. From this logic, accounting has some similarity with mathematics and this probably why taking mathematics classes helps with accounting classes (Babalola & Abiola

According to Thomason (

Understanding what mathematics competences or skills are required can assist individuals in business processes in the following ways:

Mathematical calculations: It is vital to have basic mathematics and algebra skills to complete accounting tasks or activities as they are full of basic and advanced calculations and report accurate financial information.

Word problems: Word problems that arise in accounting usually relate to essential mathematical concepts. Therefore, reading skills are needed in addition to mathematical competence.

Time value of money concepts: Problems occur in accounting in relationship to time value of money and require the use of various mathematical abilities.

Other skills: There are other important skills that go beyond mathematics and accounting abilities, such as communication skills. Relatively little mathematics is required for studying accounting.

As listed by Mostyn (

Summary of mathematical content needed for accounting.

Topic area | Specific content | Description |
---|---|---|

Number and operations | Place-value numerical system | Positioning numbers in a place-value numerical system. |

Basic arithmetic operations | The four basic operations +, −, ×, ÷, BOMDAS or BODMAS rule. | |

Rational numbers | Expressing amounts as fractions, decimals and percentages. Rounding off amounts with decimal amount. | |

Integers | Adding, subtracting, multiplying and dividing numbers that are positive and negative. | |

Ratio and proportions | Expressing numerical relationships as ratios, rates, proportions and averages. | |

Exponents | Understanding calculations with exponents. | |

Patterns and algebra | Formulas | Substituting and changing the subject of the formula. |

Algebraic equations | Working with linear equations and exponential calculations. | |

Mathematical modelling | Creating mathematical formula/equation from a real-life context or word problem. | |

Financial mathematics | Performing time value of money calculations. | |

Data handling and Probability | Statistics | Creating tables and understanding calculations with forecasts or projections, knowing statistical issues (i.e. mean). |

Please see the full reference list of the article, Mkhize, M.V., 2018, ‘Transdisciplinary relationship between mathematics and accounting’,

BOMDAS, Brackets, of, multiplication, division, addition and subtraction; BODMAS, brackets, of, division, multiplication, addition and subtraction.

Discussions on previous studies on the importance of mathematics in accounting and on the issue of mathematics, Mathematical Literacy and quantitative methods as a prerequisite follow next.

In several studies, mathematics knowledge positively influenced students’ achievement in accounting learning. Gist, Goedde and Ward (

Equally important, a study of 526 students in a 3-year accounting degree, by (Koh & Koh

In contrast, Naser and Peel (

A study by Latief (

In summary, studies recommend that mathematics should be a prerequisite for the study of accounting or a mathematics bridging programme. Discussion on the problem-solving skills in accounting is presented next.

Accounting is a subject based on mathematical word problems (Babalola & Abiola

Polya’s four steps for solving word problems.

A qualitative research design was adopted for this study in the form of content analysis using documents to examine the transdisciplinary relationship between mathematics and accounting.

A detailed analysis of the BEd Accounting course packs for first-, second- and third-year accounting (

Bachelor of Education Accounting curriculum at higher education institution.

Semester | Module year | Accounting topics |
---|---|---|

First | First-year accounting | Sole traders: accounting equation, subsidiary books and source documents, salaries and wages, final accounts and financial statements |

Second | Sole traders: bank reconciliation, periodic inventory system, disposal of assets and financial statements of a sole trader | |

First | Second-year accounting | Partnership and companies: year-end adjustments, advanced financial statements, cash flow statements, and analysis and interpretation of financial statements |

Second | Close corporations and cash budgets: advanced financial statements, analysis and interpretation of financial statements, cash budgets and forecasted income statements | |

First | Third-year accounting | Non-profit organisations, manufacturing and VAT accounting: advanced financial statements of NPO, manufacturing accounts and financial statements of a manufacturing concern, VAT Accounting. |

Second | Retirement and liquidation of partnerships, branch accounting. |

VAT, value-added tax.

Accounting calculations are presented using the Department of Basic Education National Curriculum Statement mathematics topics: GET Phase mathematics – Grades R–9 and FET Phase mathematics – Grades 10–12. The main topics in the GET Phase mathematics Curriculum are as follows: number, operations and relationships; patterns, functions and algebra; space, shape (geometry); measurement; and data handling. The main topics in the FET Phase mathematics Curriculum are as follows: functions; number patterns, sequences, series; finance, growth and decay; algebra; differential calculus; probability; Euclidean geometry and measurement; analytical geometry; trigonometry; and statistics (

Themes and sub-themes from content analysis of transdisciplinary relationship between mathematics and accounting.

Theme (maths topics) 1 | General content focus | Sub-theme (sub-topics) |
---|---|---|

1. Number operations | Development of the number sense that includes:
the meaning of different kinds of numbers relationship between different kinds of numbers representation of numbers in various ways the effect of operating with numbers the ability to estimate and check solutions. |
1.1 Place-value numerical system |

2. Patterns and algebra | A central part of this content area is for the learner to achieve efficient manipulative skills in the use of algebra. It focuses on the:
description of patterns and relationships through the use of symbolic expressions and tables identification and analysis of regularities and change in patterns and relationships that enable learners to make predictions and solve problems. |
2.1 Formulas (substituting and hanging subject of formula) |

3. Data handling and probability (statistics) | Data handling involves asking questions and finding answers in order to describe events and the social, technological and economic environment. Through the study of data handling, the learner develops the skills to collect, organise, represent, analyse, interpret and report data. |
3.1 Averages, weighted average and projections or forecasts |

A summary of the strategies and the criteria used to establish trustworthiness is as follows:

Feedback received from the reviewers – member checks and peer confirmation of interpretations (trustworthiness).

Confirmation of findings through triangulation: this provided evidence for validity.

Reliability ensured through reference to the supervisors of my study and their positive feedback on the data interpretation.

Ethical clearance was obtained from the Human Research Ethics Committee of the higher education institution (reference number: HSS/0117/013D).

The objective of this section is to highlight specific parts of mathematics topics required for the study of accounting in the BEd curriculum at the HEI research setting.

To illustrate the transdisciplinary relationship between Mathematics and Accounting, examples were selected from the first-, second- and third-year HEI BEd Accounting curriculum to identify specific topics in mathematics used in accounting. There was also an overlap in topics, but I have decided to present accounting calculations using the National Curriculum Statement mathematics topics (GET Phase and FET Phase mathematics), selected examples and explanations illustrated below.

In accounting, students need to be able to arrange amounts in the correct order. They need to know that a line between rands and cents represents a decimal point. Negative amounts are always reflected in brackets and positive amounts are reflected without brackets. Accounting also requires ability to work with big numbers.

Consider the following example: Extract from the statement of comprehensive income of Edgewood Traders for the year ended 31 December 2015, reflecting amounts in the place-value system (

Positioning numbers in a place-value numerical system.

In analysing the accounting course packs, it became evident that BEd Accounting students need to be able to identify relevant amounts from a given information or write amounts in correct positions in a place-value numerical system. Inability to identify or write amounts could have a negative effect on students’ performance.

Students need to have the knowledge of the four basic operations (+ − × ÷) because these operations are used in accounting. They need to read the question carefully and do as instructed. They need to know how to round off, because they may be required to round off to the nearest one decimal point, nearest two decimal points or nearest R1, R10 or R100, et cetera. Therefore, they need to know that amounts ending in 4 or less are rounded down (i.e. 1.233 becomes 1.24) and amounts ending in five or more are rounded up (i.e. 1.235 becomes 1.24). They also need to know about addition and subtraction and zero and be able to add, subtract, multiply and divide integers. They need to understand the logic of calculations when preparing source documents as these require knowledge of basic mathematical operations, integers and percentages, and they need to be able to use a calculator.

Consider the following example from first-year accounting: On 01 February 2015, Edgewood Traders sold goods to S. Khumalo on credit. Issue invoice No X02 address 12, Durban North Road, five trays @ R25.99 and 10 sets cutlery @ R45.99 (

Credit invoice as an example of use of basic arithmetic operations.

Students need to understand percentages, fractions, and decimals to solve real-life accounting problems. They need to be able to convert or express percentage as a decimal (e.g. 90% = 0.90) by just moving the decimal point by two places to the left of the given number. They also need to be able to convert or express a percentage as a fraction by just dividing by 100 (e.g.

Consider the following example (second-year accounting): Equipment bought on account from Jeena Wholesalers for R15 000 less 10% trade discount (see

Solution trade discount.

Students must understand percentages and basic operations when performing calculations involving a trade discount. In order to record the correct amount in the creditors journal, students need to calculate the correct amount of this equipment. They are encouraged to master table method algebra, as it shows how the formula is derived. They should be able to equate proportional fractions and solve for the variable or unknown (Method 1). They should also be able to recognise that the formula method is derived from the last but one step of the table method algebra. Knowledge of both methods will assist the student in verifying the answer if he or she has forgotten the formula or is not sure of the answer given by one method. The table method could assist in eradicating severe deficiencies in basic arithmetic skills.

For calculating profit mark-up percentage, consider the following example: Goods bought for R12 000 were sold for R17 400. Calculate the profit percentage (

Solution profit percentage calculation.

Students must be able to differentiate between

Students must be able to calculate ratios by extracting appropriate information from financial statements. Financial statements analysis is conducted in the first-, second- and third-year modules. Therefore, students need to know and understand ratios. For students to understand the formula, they must be able to perform ratio analysis. Students must write a formula first, expand the formula (if there is a need), substitute the correct amounts and calculate. Examples of financial ratios are shown in

Examples of financial ratios.

Students must be able to apportion insurance amount according to the percentages given for each of the given departments. Students must demonstrate an understanding of the split of costs between the factory, sales and office departments. Knowledge of fractions, ratios and percentages taught in Grades 8 and 9 and GET Mathematics is essential for splitting the costs between departments.

Example taken from third-year accounting is presented below – production concerns: Insurance R5600, electricity allocated between the factory, selling and distribution and administration as follows:

Factory | Sales | Office | |

Insurance | 60% | 20% | 20% |

Adjustment: R900 was paid in advance for insurance at the end of the year (

Allocation of amount according to given percentages.

For ratios in distributing partners’ profit, students must be able to distribute profit according to a specified ratio as it appears in the partnership agreement, beginning capital balance ratio, closing capital balance ratio or average capital balance ratio in months.

Consider the following example (third-year accounting), average capital balance ratio in months: The financial year-end of Edgewood Traders is 31 December each year. Capital: Edge (31/12/2015), R120 000 and Capital: Wood (31/12/2015), R150 000. Adjustment – additional capital by Edge (1/7/2015), R20 000 and cash withdrawal of capital by Wood (1/10/2015), R50 000.

Therefore, the profit sharing ratio according to average capital ratio is R110 000 : R137 500 (

Average capital balance ratio in months.

For ratios in existing partners altering their profit sharing ratio (third-year accounting), students must be able to distribute profit according to the new ratio from the date of change (

New profit sharing ratio. From third-year BEd Accounting.

Students must know that if the profit mark-up is on cost, then cost price represents 100%. If the profit mark-up is on sales, then the selling price represents 100%. Students need to calculate the cost of sales first in order to record the amount under cost of sales column in the cash receipts journal. They need to know both methods so that in case they forget the formula, they can revert to the table method, equate proportional fractions and solve for the unknown. The last but one step of the table method shows the formula that the student must know and understand (

Cost price calculation.

Proportional fractions involving mixed fractions. Consider the following example from Branch accounting: Goods are supplied to the branch at selling price (cost price plus

Cost of sales calculation given a mixed fraction percentage.

Students need to calculate first, before recording the journal entries and posting to general ledger (see

General ledger.

Dr Branch stock account | R13 500 | Dr Branch stock account | R 4 500 |

Cr Goods-sent-to-branch account | R13 500 | Cr Branch adjustment account | R 4 500 |

Students must know that at break-even point there is no profit or loss. If the production is less (more) than break-even point, it means there is loss (profit). Students must be able to work backwards to calculate the missing amount. It is also important that students first understand the calculation of unit costs and break-even point so that they can quote it to substantiate their comment when required. Students must be able to substitute from the relevant formula and solve by making the unknown the subject of the formula. Consider the following example from third-year accounting (

Break-even point in units and value calculation.

As shown in

Students must also know that they could be given total variable costs. See Step 3 above and

Students could also be given contribution cost per unit. See Step 4 above and the formula below.

Students’ understanding of linear equations is important. They need to be able to form linear equations and solve for the missing amount. They must be able to form two algebraic expressions and equate them. They must apply mathematical concepts such as distributive law; transposing constants, variables and changing signs (additive inverse); and multiplying by multiplicative inverse of the coefficient of variable. In addition, they must be able to check the solution by substituting the answer to the original equation. If the left-hand side is equal to the right-hand side, then the solution is correct or valid, provided the equation formed is correct. By the end of Grade 9, students should have covered algebraic equations. The example in

Third-year accounting.

Edgewood Traders (Extract) | ||

Pre- Adjustment Trial Balance on 31 December 2015 | ||

Profit and loss | 140 000 | |

Interest on capital: J. James | 65 000 | |

Interest on capital: P Pule | 30,00 | |

Commission | ? |

Partnership agreement: Partner, J. James, is entitled to a commission of 20% of the net profit after his interest on capital and his own commission has been taken into account (

Commission calculation using linear equation method.

Accounting equation: I will set this out at length as I feel it is important and is often a challenge for students. Equations in accounting are called

Statement of financial position.

In the basic accounting equation (

where A = Assets, O = Owners’ equity and L = Liabilities.

Students must know that the original accounting equation, A = O + L, can also be written as follows:

by making O the subject of the formula, O = A – L

by making L the subject of the formula, L = A – O.

Students must know that the process of conceptualising and understanding the basic accounting equation rules requires the understanding of mathematical equations. From the equation A = O + L the basic accounting rules are derived (see

Basic accounting rules.

Mathematical explanation for derivation of the basic accounting equation rules:

Without understanding the mathematical reasoning of basic accounting equation rules, students might find themselves simply memorising the rules. If they understand the mathematical reasoning of these rules, they are less likely to be intimidated by tasks or activities that require the application of these rules. Consider the following example of basic accounting equation solution from first-year accounting.

Transaction 1: Basic accounting equation, M. Mkhize, Edgewood Traders owner deposited R 95 000 in the bank account of the business as his capital contribution.

Transaction 2: Bought merchandise on account from Jeena Wholesalers, R 12 000 (

Basic accounting equation solution.

Students need a confident understanding of mathematical modelling. Understanding will be gained if they have had a great deal of exposure to working with accounting activities involving mathematical modelling. Students must not be intimidated by this type of adjustment, which requires an understanding of mathematical skills such as deriving timeline, forming and solving equations, checking answer from the original equation or using the formula to verify the answer.

Consider the following examples from first-year accounting. Adjusting rent given a percentage increase. Pre-adjustment Trial Balance on 31 December 2015 (Extract):

Debit | Credit | |

Rent income | 27 400 |

Rent increased by 10% on 01 July 2015 and has been received for 13 months (

Rent calculation, given increase in percentage.

Timeline for Method 1: Let the rent be y.

J | F | M | A | M | J | J | A | S | O | N | D | J |

100%y | 100%y | 100%y | 100%y | 100%y | 100%y | 110%y | 110%y | 110%y | 110%y | 110%y | 110%y | 110%y |

Timeline for Method 2: Let the rent before increase be p and let the rent after increase be q.

J | F | M | A | M | J | J | A | S | O | N | D | J |

100% | 100% | 100% | 100% | 100% | 100% | 110% | 110% | 110% | 110% | 110% | 110% | 110% |

p | p | p | p | p | p | q | q | q | q | Q | q | q |

Timeline for Method 1: Let the rent be y.

J | F | M | A | M | J | J | A | S | O | N | D | J |

100%y | 100%y | 100%y | 100%y | 100%y | 100%y | 90%y | 90%y | 90%y | 90%y | 90%y | 90%y | 90%y |

Timeline for Method 2: Let the rent before decrease be p and let the rent after decrease be q.

J | F | M | A | M | J | J | A | S | O | N | D | J |

100% | 100% | 100% | 100% | 100% | 100% | 90% | 90% | 90% | 90% | 90% | 90% | 90% |

P | p | p | p | p | P | q | q | q | q | q | q | q |

Timeline: Let the rent before increase be

J | F | M | A | M | J | J | A | S | O | N | D | J |

p | p | p | p | p | P | p+200 | p+200 | p+200 | p+200 | p+200 | p+200 | p+200 |

Students must be able to differentiate between a rent percentage decrease and increase. The example below involves adjusting rent given a percentage decrease.

Rent – given a percentage decrease: Adjusting rent given a percentage decrease. Pre-adjustment Trial Balance on 31 December 2014 (Extract):

Debit | Credit | |

Rent income | 6150 |

Rent decreased by 10% on 01 July 2014 and has been received for 13 months. Therefore, timelines are given a percentage decrease.

By following the algebraic and algorithm methods shown in

Rent – given an increase by amount: Students must be able to adjust rent amount if given an increase or decrease in amount. Consider the following example from second-year accounting: Pre-adjustment trial balance on 31 December 2015:

Debit | Credit | |

Rent income | 27 400 |

Rent increased on 01 July 2015 by R200 per month and has been received for 13 months (

Rent calculation given increase in amount.

Timeline and calculations, given increase by amount. Rent – given a decrease by amount: Students must be able to form an equation and solve it if rent decreased by an amount per month, and know that the algorithm or shortcut for the decrease in rent amount per month is (see

Algebraic equations in value-added tax (VAT) calculation Students must be able to prepare or create a VAT table and equate proportional fractions and solve for the unknown. They must also be able to derive the formula (Method 2) from the last but one step of the algebraic equation (Method 1). They need to know the algebraic method in order to verify the answer. If they have forgotten the formula, they need to consider the VAT example. They should also understand the problem and apply the mathematical principles relevant to equations, percentages, fractions, proportions and basic operations. These are covered in GET Mathematics Grades 8 and 9 levels before students select mathematics or Mathematical Literacy in Grade 10. Calculating VAT in terms of the table method assists students in understanding when to use a calculation involving

Value-added tax calculation.

Depreciation is the sum-of-the-digits method. Consider the following example:

Debit | Credit | |

Plant (at cost) | 110 000 | |

Accumulated depreciation on plant | 38 000 |

Adjustment and additional information: Depreciation must be written off on plant in its third-year, over 10 years, using the sum-of-the-digits method (

Sum-of-the-years-digits method.

Students must be able to form a series in descending order and get the sum of all digits. To get the depreciation, they must know that one has to consider the year and divide by the sum-of-the-years digits and multiply by the cost of an asset without being confused when performing this type of depreciation method.

Students should be able to read financial information from given tables and follow instructions. They must also prepare tables and perform calculations as well as record amounts and details in the appropriate given table columns.

In this section, I will show that in financial mathematics there is a clear link that transfers across to accounting, as in formulas, exponents and substitution. This aspect is also referred to as time value of money because money has value over time. If you invest, you must be compensated for waiting or taking risk. All BEd Accounting students must know financial mathematics formulas. They must remember each of these formulas and be able to substitute values into the formulas, and they must also know how to change the subject of the formula. They must use the calculator to perform the calculation and have knowledge of calculations involving exponents. They must know how to apply the brackets of multiplication, division, addition and subtraction (BOMDAS) or brackets of division, multiplication, addition and subtraction (BODMAS) rule. Students must also know the exponential rules, such as

Simple interest – Mathematics versus accounting.

where

where A = amount received at the end of investment period,

Students need to know the compound interest formula and how to make the subject of the formula and apply the formula to relevant accounting problems. As shown in

Compound interest – Mathematics versus accounting.

Students must know

Calculating rate of interest.

Extract from Cash budget of Edgewood Ltd for January and February 2012.

Cash payments | January | February |
---|---|---|

Repayment of loan | 0 | 120 000 |

Interest on loan | 5 000 | ? |

Note: Additional information: Loan received on 31 December 2010 is R300 000. Interest is paid monthly by cheque.

Students must know and understand

Date on which the loan was reduced.

Extract from the Statement of financial position of Edgewood Traders. Accounting period ends on 28 February each year:

2015 | 2014 | |

Non-current liabilities (15%) | R50 000 | R80 000 |

Interest on loan | 9 750 | 12 000 |

Calculate the date on which the loan was reduced. |

Using the formula involving logarithms (from compound interest formula, n made subject of the formula, as shown in

The

where

Simple and compound depreciation methods are used for both cost price and diminishing balance methods. Accounting students are required to know these formulas for cost price and diminishing depreciation methods in order to be able to perform depreciation calculation when given different values. Students must be able to substitute into formulas and know how to change the subject of the formula. Students must use a calculator to perform the calculation and have knowledge of calculations involving exponents. Cost price (straight line or flat rate) method.

where

where

Students must be able to apply the above formulas to different depreciation calculations. They must also be able to calculate depreciation of tangible asset, if acquired, during the year.

Diminishing balance (reducing balance or book value or carrying value) method

where

This formula is frequently used by students because it gives depreciation without performing a lot of steps. Students must know that one has to first reduce accumulated depreciation from the cost price of an asset (book value of an asset beginning of the financial year) before multiplying by rate (

where:

In _{ey}= book value at the end of the financial year, CP = the cost price of an asset, AD = accumulated depreciation of an asset,

In _{ey}= Book value at the beginning of the financial year and BV_{ey}= book value at the end of the financial year.

Students must be able to use the above formulas for different depreciation calculation activities. They must also be able to calculate deprecation of fixed assets acquired during the financial year, as shown in

Extract: Pre-adjustment trial balance of Edgewood Traders on 28 February 2013 (EDAC210EC)

Debit | Credit | |

Vehicles (at cost) | 210 000 | |

Accumulated depreciation on vehicles | 17 100 |

Diminishing balance method – Simple and compound interest.

Provide depreciation on vehicles at 15% per annum on the diminished balance method. (Take into account that a new vehicle was bought on 01 December 2012 for R120 000).

In the case of the

Edgewood Ltd was established with an authorised share capital of R600 000 ordinary shares. 200 000 shares were issued to the public as follows: 100 000 shares at R8 each and 100 000 shares at R12 each.

Method 1 formula – average price per share.

Formula – weighted average price of inventory available.

For the

Students must know the formula and substitute the values from the formula. Students must know that the weighted average price of inventory available is multiplied by units on hand at the end of the financial year in order to get the value of closing inventory at the financial year if the business uses the periodic inventory system.

The value of closing stock according to the weighted average method is:

This amount will affect the calculation of gross profit in the trading account.

For both the weighted average price per share and stock available, students must demonstrate a systematic way of thinking (mathematical reasoning) and organising amounts given in calculating the weighted average price.

Mathematics concepts such as statistics are used to forecast future cash flows based on several different scenarios. In second-year accounting, data handling and probabilities are used when preparing cash budgets and projections or forecasts (see example in

Consider the following example from second-year accounting.

Cash budget solutions and workings.

Students should be able to do calculations relevant to specific amounts in the cash budget for the cash sales and cash collected from debtors and payment to creditors. Therefore, debtors collection period and creditors payment schedule are important in knowing how to do workings or calculations. Not knowing what amounts or percentages to use may prevent students from getting correct answers to record in the cash budget. The students must know and understand concepts like decrease and increase. From projected income statement and the cash budget, they should know how to calculate mark-up percentage, percentage increase or decrease (e.g. in salaries and wages). This means that mathematical reasoning is important and requires a great deal of practice. Students not able to identify amounts and having mathematical deficiencies in performing percentage calculations may find this section challenging.

Bachelor of Education Accounting curriculum: Elements of mathematics knowledge and skills.

I will illustrate the transdisciplinary relationship between Mathematics and Accounting with the specific topics in mathematics used in accounting.

The analysis has revealed that basic mathematics skills are crucial to understanding accounting. It is evident that BEd Accounting students need to be confident of their ability to work with calculations, as many topics illustrated in the examples indicate that most of mathematics (about 90% of it) required in BEd Accounting should have been covered at GET Mathematics (Grades R–9); this would include for instance, place-value numerical system, basic arithmetic operations, integers, ratios and proportions, formulas, linear equations, mathematical modelling and exponents. Only a small part of FET Mathematics, Grades 10–12, is required for accounting, such as number patterns, averages and weighted averages, projections, logarithms and financial mathematics.

The analysis of course packs confirmed that the mathematical content is needed for accounting, as indicated in the literature review. Accounting examples provided under each mathematical topic showed that transforming accounting data, through mathematical processes and logic, into useful information for accounting decision-making requires students to understand Polya’s (

It has been shown from the analysis of course packs that algebraic method is important in accounting as it applies to the majority of mathematical accounting problems, meaning that the algebraic method is important for students to know and understand. The algebraic method is also helpful for showing formula from each last but one step of the solution. If students are not happy about an answer they get using a formula, they can simply verify the answer by performing calculations using algebraic method. For students to master algebraic method, they must be familiar with proportional fractions and equations.

The calculations performed during the analysis of course packs make it clear that students must show workings or provide or supply a detailed calculation to support their answers, as marks in accounting are awarded for what is shown. Students must make sure that workings are cross-referenced to the final solution.

The analysis of BEd Accounting course packs showed the importance of number operations: the place-value numerical system; basic arithmetic operations; rational numbers (e.g. percentages, fractions and decimals); integers, averages and weighted average; and ratios and proportions. These topics are covered in Grades R–9 GET Mathematics.

Also apparent from the analysis of BEd Accounting course packs was the importance of patterns and algebra: formulas, substituting and changing subject of formula; linear equations; mathematical modelling; tables; time value of money and exponents. These topics are covered in Grades R–9 GET Mathematics at school level.

The mathematical topics that were found to be important were as follows: number patterns, when calculating depreciation using sum-of-the-digits method; exponents, when performing time value of money activities; and logarithms, when calculating date on which a loan or investment was reduced or increased. Number patterns, exponents and logarithms are found in the Grades 10–12 FET Mathematics, as are time value of money formulas (e.g. simple and compound interest and simple and compound depreciation). Time value of money is part of both Grades 10–12 FET Mathematics and Grades 10–12 FET Mathematical Literacy (Department of Basic Education

For lecturers, in-service teachers and subject advisers, the results of this study will assist with the delivery of the accounting curriculum and provide learning approaches that might alleviate negative attitudes towards mathematics. The analysis of accounting course packs showed, for example that table method algebra is important in accounting as it assists in getting the answers in almost all mathematical accounting tasks in each accounting module and also indicates a formula that students can use as an algorithm. The formula is derived from the last but one step from the answer. To master the table method algebra, students must know proportional fractions and linear equations. Because students are advised to show workings or supply a detailed calculation to support their answers as marks in accounting are awarded for what is shown, they need to make sure that workings are cross-referenced to the final solution. It was also found that transforming accounting data through a mathematical process, logic and application into useful information for accounting decision-making requires students to understand Polya’s (

Lecturers, in-service teachers and subject advisers should follow the accounting calculation methods indicated in this study, as this will assist with the delivery of the accounting curriculum in higher education and basic education. The accounting calculation methods provide innovative learning approaches that might assist in alleviating negative attitudes towards mathematics.

Textbook writers, curriculum specialists and international and national policymakers are encouraged to include the accounting calculation methods indicated in this study as this will assist students experiencing difficulties with mathematics.

The author declares that he has no financial or personal relationships which may have inappropriately influenced him in writing this article.