Cloud Accounting for Goodie Gumdrops

This assignment analyzes the advantages of implementing a cloud-based accounting system for Goodie Gumdrops, a start-up business. It contrasts cloud accounting with traditional methods, highlighting cost-effectiveness, real-time data access, and security features. The assignment includes financial reports such as profit and loss statements, balance sheets, and trial balances. Assumptions are stated regarding purchase prices, selling prices, and bank balances. Finally, references are cited to support the discussion.

Client Name: Goodie Gumdrops
Your name:
Topic: Accounting Information System
Date:
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Executive summary
The cloud based accounting system is the new generation system of accounting which
processes the entire accounting process online and stores data in the server also called
‘clouds’. Due to evolution of cloud based accounting, today it is possible for every
employees, managers and owner of the company to get access to any accounting information
from anywhere in the world with the aid of internet service. The information and data that are
entered into the system are stored in the cloud and those are also processed in such a manner
that anyone having the authority can get access to those data in no time from anywhere.
Unlike the traditional method of bookkeeping where a lot of time and resources are involved
in maintaining books of accounts, the new cloud based technology on the other hand ensures
effective utilization of both time and resources and also guarantees savings in the overall cost
of maintaining books of accounts and accounting techniques.
From the case study it is evident that Goodie Gumdrops is a start-up business that have
allocated a dedicated hard drive for the purpose of storing and recording accounting
information. Unlike traditional method of accounting, the cloud based accounting system not
only ensures security of those data but also ensures that those are properly backed up which is
not available in traditional method of bookkeeping.
In today’s business world, cloud accounting is found as more rational process of accounting
than that of conventional accounting system. An important characteristics of cloud based
accounting is that it is very much cost effective. The initial cost of installation of cloud
accounting system is very negligible and in long run also it saves a lot of money of the
business through the application of its various technologies. A cloud based accounting
software enable the user in performing multifunction tasks simultaneously and as all the
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calculation are already programmed in the software thus it also reduces the probability of
error by an employee to a great extent.
Another important feature of Cloud based accounting system which makes it standout in the
market is its real time feature. At times when the owner and other stakeholders of the
company are required to take any crucial investment decision then cloud based accounting
will be very helpful as with the help of cloud accounting the owners, manager, directors and
other stakeholders can get access to the real time financial position of the company which is
updated till the last minute. This ensure that correct decision will be take in favour of the
company by the stakeholders and advisors. This will not be possible in case the company uses
traditional method of accounting as in that case the entire process will become much more
lengthy and costly as well. Moreover as said earlier in the cloud accounting software, all the
data are automatically backed up at the end of the day. Thus it relief the entire work staff
from the burden of backup which was present in the traditional method of accounting.
Thus for a start-up business like Goodie Gumdrops which is in the growing, it is always
recommendable to adopt cloud based accounting system over traditional accounting system
as the company is not in a state to invest a huge amount on accounting. Cloud accounting
software like MYOB, XERO might be an interesting choice for Goodie Gumdrops at
minimum cost.
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Financial reports for Goodie Gumdrops
Profit and Loss Statement:
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Balance Sheet
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Trial Balance:
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Aged payable (details)
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Aged receivable (details)
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Inventory Item Summary
Assumptions:
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The assumptions used are:
 The Purchase price is assumed to be $1 per unit;
 The Selling price is assumed to be $1.50 per unit;
 The Opening bank balance is taken a Nil.
 The missing date is assumed to be 3rd August 2017;
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Reference List
Abernethy, B. S. (2015). U.S. Patent Application No. 14/705,265.
Adenike, A. T., & Michael, A. A. (2016). Effect of Accounting Information System Adoption
on Accounting Activities in Manufacturing Industries in Nigeria.
Mcleod, S., & Freeman, J. (2015). U.S. Patent Application No. 14/693,198.
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