logo

Accounting And Finance - PDF

   

Added on  2021-01-01

13 Pages3272 Words387 Views
Introduction To Accounting And Finance

Table of ContentsINTRODUCTION...........................................................................................................................1PART A...........................................................................................................................................1PART B............................................................................................................................................3PART C............................................................................................................................................5(b) Merits and limitations............................................................................................................6(c) Benefits and limitation of budgets.........................................................................................9CONCLUSION..............................................................................................................................10REFERNCES.................................................................................................................................11

INTRODUCTIONAccounting and finance both are important for an organisation to manage businessactivities in effective manner (Aggarwal and Goodell, 2014) . Through principle of accountingand finance apply in the accounts of company and prepare with rules and regulations. Both aredifferent from each other because in accounting consider day to day flow of money in and out ofa company or institution. On the other side finance is a broader term for the management ofassets and liabilities and the planning of future growth. Accounting is more about reliabilityreporting which is already happen with law and standards. While finance is looking forward andgrowing a pot of money or mitigating losses. The particular report has been divided into threeparts, in first part define about concepts and techniques of financial accounting. In second part,models and techniques of management accounting and in part third, role of finance regarding todecision making process. PART AIncome Statement – An income statement is one of major part of final accounts whichcan help to calculate net profit of particular accounting periods. It can prepare by an organisationto know financial performance and business activities. In income statement consider operatingexpenses which can expense to operate business activities in direct manner. There are alsoconsidering Income which is gain by company in their accounting period. From income lessamount of expenses then remaining amount known as net profit. Income statement also known asprofit and loss statement, statement of revenues and expenses (Ahmed and Duellman, 2013) . Income Statement for the year end 31 December 2018Particulars Amount (£)Sales 633000Less – Cost of sales 297000Gross Profit 336000Less – Operating Expenses Electricity Bills 5700Van Running Expenses 33600Wages 117000Rent 90000Rates 38552501551

Net Profit 85845Interpretation – As per the above table it is getting that the company the companygenerate £336000 gross profit in specific accounting period as well as £85845. From the amountof sales less amount of cost of sales after then get amount of gross profit which is £336000. Fromgross profit deduct amount of operating expenses which is electricity bills, van running expenses,wages, rent and rates. After then remaining amount known as net profit. Working Note - Sales = (504000 + 129000) = 633000Cost of Sales = ( 243000 + 54000) = 297000Rates - In 2018 = 106*3 = 480 (January to March)In 2018 = 375*9 = 3375 (April to December) Balance Sheet – A balance sheet is a financial statement that defined about organisation'sassets, liabilities and shareholder's equity of particular accounting period. On the basis of theseinformation calculate rate of return and capital structure of a company (Atanasov and Black,2012) The particular financial statement can provide a snapshot of what a company owns andowes as well as the amount invested by shareholders. The balance sheet provide information toreader about company performance and it allows someone like a creditor to see what a companyowns as well as what it owes to other parties as the date point in the heading. Balance Sheet as per year ending 31 December 2018 Assets Non current assets Motor Van 60000Less – Depreciation 960050400Premises 22500Current assets Bank 135000Trade Receivables (486000- 393000 - 1500) 486000Less – Payment to trade payables 393000Less – Bad debts 15009150002

End of preview

Want to access all the pages? Upload your documents or become a member.

Related Documents
Accounting and Finance Assignment Solution
|15
|4109
|202

Introduction to Accounting and Finance Assessment
|17
|4128
|107

Introduction to Accounting and Finance Assignment (Doc)
|17
|4366
|185

Assignment on Accounting and Finance (Solution)
|18
|3874
|28

Introduction to Accounting and Finance
|19
|3873
|478

Introduction to Accounting and Finance
|15
|4043
|231