Lesson Plan

• Distinguish between capital and revenue expenditures and receipts.
• Calculate the profit impact when a capital item is incorrectly expensed.
• Calculate the profit impact when a revenue expense is incorrectly capitalised.
• Apply a step‑by‑step decision process to classify transactions correctly.
• Comment on the direction and magnitude of profit changes in exam‑style answers.

• Projector or interactive whiteboard
• Printed worksheet with transaction examples
• Calculator or spreadsheet software
• Accounting textbook or syllabus excerpt
• Whiteboard and markers
• Answer key for practice questions

Begin with a quick poll: “When you buy a delivery van, does it affect profit immediately?” Review prior knowledge of capital vs. revenue items, then state that today students will learn to identify mis‑treatments and quantify their effect on profit. Success criteria: correctly classify transactions and explain profit changes.

1. Do‑Now (5’) – Students list examples of capital and revenue items on sticky notes.
2. Mini‑lecture (10’) – Define capital/revenue expenditures and receipts; display decision flowchart.
3. Guided practice (12’) – Work through two examples (van purchase, advertising cost) calculating correct and incorrect profit impacts.
4. Group activity (10’) – Teams receive mixed transaction cards, classify, record journal entries, and compute profit effect.
5. Check for understanding (5’) – Quick clicker quiz: identify error type and profit direction.
6. Summary & exam tips (8’) – Highlight steps to avoid pitfalls and how to comment in exam answers.

Recap the key rule: mis‑classifying capital as revenue understates current profit and overstates future profit, while the opposite inflates current profit. For the exit ticket, each student writes a concise comment on the profit effect of a given mis‑treatment. Homework: complete the worksheet with three additional transactions and prepare brief explanations.