Accounting Information and Decision Makers

Academic

Contents
INTRODUCTION.......................................................................................................................................3
ASSESSMENT 1....................................................................................................................................3
PART 1....................................................................................................................................................3
Part 2.......................................................................................................................................................5
Part 3.......................................................................................................................................................6
Part 4.....................................................................................................................................................11
ASSESSEMENT 2................................................................................................................................12
PART A.................................................................................................................................................12
PART B.................................................................................................................................................19
CONCLUSION.........................................................................................................................................23
REFERENCES..........................................................................................................................................24

INTRODUCTION
It essential for companies to record their business transactions in a manner by which accountants
can gather utilize key information for further processing (De Kruijff and Weigand, 2017). There
are a range of activities and operations which are performed in order to prepare financial reports
but basis is only one which is to correctively recording of financial activities. The report is based
on two assessments under which distinct type of requirement is needed. In the assessment one
different kinds of calculations are performed while in second part Linda’s business’s financial
performance is analyzed through ratio analysis.
ASSESSMENT 1
PART 1
(a) Who are the decision makers referred to in the above definition and explain their need for
accounting information?
Decision-makers are people within an organization who do have the capacity to make
informed choices, such as purchases, development, or investment. Organizational,
business processes, practical, personal, scheduled, and non-programmed decisions could
be part of any context of decision. In the Tesco plc sense, the choice is made by the
individuals referred to below, which are as follows:
Management- Administrators are also invited to take steps in order to solve challenges.
Decision-making and problem-solving require ongoing processes in which situations or
concerns are analyses, solutions discussed, decisions being made and necessary measures
taken (Deshpande, Shiurkar and Devane, 2017). The method of judgment is always very
brief and the mental analysis is almost instantaneous. In certain cases, the procedure can
take months or even years. The entire decision-making process depends on the best
information available to the relevant individual at the right time. Managers take crucial
decisions related to various kinds of aspects in the sense of the above business.

ACCOUNTING INFORMATION ROLE: Accounting Information is designed to help
administrators within the enterprise, whereas accrual reporting is designed to provide
non-organizational entities with accounting reporting.
Owner- The company owner still plays a crucial role in taking corrective decisions.
Primary owners typically guide the judgment process, work closely with additional
owners, fix challenges, delegate assignments to other roles or managers (if required),
complete the journey, have the final approval authority (if / when used) and are generally
responsible for the outcomes of the different components. Tesco plc's holder plays a
crucial part in judgment (Christensen, Cottrell and Budd, 2016). They use key accounting
data.
Accounting details role- Accounting gives significant financial expertise useful for
judgment to management and staff. Assessment of the role of the owner in preserving and
managing the organization's profits. Decide whether company money is lent or invested.
(b) Identify and explain the advantages and disadvantages of any two for profit business
structures which an accountant may encounter.
Accounting- Finance is the system of reporting of cash activities involved with
companies. Summarization, examination and report of these practices to supervisory
agencies, authorities and customs officials are necessary for the accounting process
(Zotorvie, 2017). The profit corporation describes some benefits and drawbacks below:
Benefits:
Full and Systematic Record- Accounting relies on generally accepted norms and on the
empirical means through which books represent corporate activities. For example, all
corporate operations are periodically and thoroughly registered. As any sale can be
reported and evaluated by the same process, the human limitations that cannot be taken
into consideration in all transactions are overcome by reporting.

Helps to collect loans- Business should have sufficient capital for further expansion.
Occasionally, because of the shortage of capital, the organization could not do well
(Wagner, Datascape Inc, 2016). In such situations, by obtaining loans from other
financial institutions such as banks, more funds may be collected. These commercial
banks offer loans on the basis of the business entity's feasibility and legitimacy. The
Exchange and Profit & Expense Report and cash balances, the final analyses of financial
documents, will measure the productivity and authenticity.
Drawbacks:
Preference to Rational Decision Making- Analytical decisions can be taken with the help
of financial techniques. Often accounting firms and senior management, however, favor
prior judgment expertise and insight (Hauser, Suboti LLC, 2016). This is because taking
an intuitive decision is genuinely transparent and easy.
The decisions are made by the administration. Their execution is in the possession of the
auditor in charge of operations. For the efficient operation of the management accounting
practices, the continued contributions of management accountants and the complete
involvement of all management levels are important.
Part 2
A. Journal Entries for the month of February 2020
Date Particulars Debit (£) Credit (£)
01/02/20 Asma Ltd. A/c..........................Dr.
To Office fixtures A/c
(Unsuitable office fixtures returned to Asma
Ltd.)
350
350
04/02/20 Bad debt A/c............................Dr.
To S. Keyes
(Debt from S.Keyes written off as bad)
85
85

09/02/20 Machinery A/c.........................Dr.
To Bank A/c
To TS Co. A/c
(Machinery bought from TS Co. on part cash
and part credit)
2300
200
2100
13/02/20 Bank A/c...................................Dr.
Bad debt A/c.............................Dr.
To S. Hill A/c
(Only £220 received out of £270 from
bankrupt debtor S. Hill as full and final
settlement)
220
50
270
20/02/20 Drawings A/c............................Dr.
To Purchases A/c
(Goods taken for personal use by owner)
180
180
26/02/20 Drawings A/c..........................Dr.
To Insurance A/c
(Personal insurance bill debited to business
not stands corrected)
85
85
28/02/20 TS Co. A/c..............................Dr.
To Bank A/c
(Half payment of machine credit paid by
owner to TS Co)
1050
1050
Part 3
A. General ledger
Ledger Accounts