Financial Accounting - Sample Assignment
Added on 2021-01-01
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Finance
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FINANCIALACCOUNTINGPRINCIPLES
Table of ContentsINTRODUCTION...........................................................................................................................3BUSINESS REPORT......................................................................................................................3(a) Financial Accounting and its purposes.............................................................................3(b) Internal and external stakeholders....................................................................................4CLIENT 1........................................................................................................................................61. Journal Entries and Ledger in the book of Alexandra Study..............................................6Ledgers...................................................................................................................................7..............................................................................................................................................122. Trial Balance as at 31st January 2019 in the books of Alexandra Study:........................122. Trial Balance as at 31st January in the books of Alexandra study...................................13CLIENT 2......................................................................................................................................141. Statement of Profit and Loss of Munteanu Ltd. For the year ended 31st December 2018142. Statement of Financial Position of Munteanu Ltd. As at 31st December 2018...............153. Accounting Concepts – Consistency and Prudency.........................................................154. Purpose of depreciation in formulating accounting Statement.........................................16CLIENT 3......................................................................................................................................171. Purpose of preparing Bank Reconciliation Statement......................................................172. Reason for difference between balance of bank column of cash book and bank statements173. Imprest..............................................................................................................................184. Bank Reconciliation Statement as at 30 September 2018................................................18CLIENT 4......................................................................................................................................191. Sales Ledger Control Account in the book of January 2018............................................192. Purchase Ledger Control Account in the books of January 2018....................................193. Control Account...............................................................................................................20CLIENT 5......................................................................................................................................201. Suspense Account and its main features..........................................................................202. Trial Balance using a control account as balancing figure...............................................203. Journal Entries for corrections..........................................................................................21CONCLUSION..............................................................................................................................21
REFERENCES..............................................................................................................................22INTRODUCTIONFinancial Accounting is a specialized branch of accounting that keep records ofcompany's financial transactions (Tinoco and Wilson, 2013). It is the process of prepare financialreports to present performance of a company. These reports are applying standardized guidelinesfor record the transactions and present in summarized way. The main purpose of the accountingto provide financial information for sound economic decision making. It can prepare financialreport shows performance company to external parties like investors, creditors and taxauthorities. In the present report selected company Airdri limited, which is dealing in electroniccomponents, net contacts in WITNEY in United Kingdom. In particular report focused on recordbusiness transactions using double entry book keeping after then produce trial balance. Inaddition, Prepare final accounts for sole traders, partnership and limited companies in thereference of accounting principles, convections and standards. Apart from, there is performingbank reconciliation for ensure bank records are correct or not and adjust control accountsaccording to requirements and recorded transactions from the suspense accounts to rightaccounts. BUSINESS REPORT(a) Financial Accounting and its purposesFinancial accounting refers to recording, summarizing, classifying and analysing thetransactions recorded in the company books of accounts. It represents the actual picture offinancial position of business. It is a systematic process and classification of financial and nonfinancial information after then record according to their nature. The financial transactions arepresented in financial reports like income statement, cash flow statement and balance sheet.These reports are part of formal report and provide to external and internal stakeholders. It willshow operating performance of the company related to accounting time period (Anandarajan,Anandarajan and Srinivasan, 2012). The transactions are recorded on the basis of accountingprinciples, convections, policies, rules and regulations. The main purpose of preparing thisstatement are as follows :-
The recording activity of financial accounting every transaction in the books of accountsis recorded, that helps to keep a track of all the information. The book consist of cash aswell as credit transactions. Analysing the purpose for the evaluation of various alternatives and selection of bestalternatives.It assist in projecting anticipated earnings and performance of business organization. (b) Internal and external stakeholdersStakeholder is either an individual, group or organization who is impacted by the successor failure of a business. Stakeholders can have a significant effect on decision regarding theoperations and finances of an organization (Chiang, Nouri and Samanta, 2014). The primarystakeholders of regular organizations are investors, suppliers, employees and customers.Stakeholders are categorised into two parts who is directly and indirectly related to the largeorganisation - Internal Stakeholders – Internal stakeholders are people who are already related to company as volunteers, boardof directors and donors. In a large business organization, internal stakeholders are management,owners, employees and shareholders. According to brief discussion there is including majorinternal stakeholders and they are directly related to the company and interested in outcomeswhich is related to financial situation, as follows - Owners and Shareholders – They are a subset of the stakeholder category where allshareholders have invested funds in the business and they become automaticallystakeholders. Shareholders and owners are the most likely to lose their money at the timeof shut down of business. They become last priority to be paid from any left over funds.They are interested into financial information because they wants to survive company forlong time and it helps in decision making process. Employees – They are local community and most considerable resources of a businessorganisation. They always wants to achieve growth with in a business to acquiresustainability growth. Employees are interested into financial information because theirsalary and career are dependant on organisation's performance and growth. External Stakeholders -
External stakeholders are those people who are impacted by work as community partners,clients, constituents and others (Lawrence, 2013). In the case of large organisation in externalstakeholders including customers, creditors, suppliers and government etc. As a brief descriptionkey external stakeholders are those person, group who are interested in financial information ofcompany. Government – Government can play role as stakeholder because it collect several taxeson incomes and on other resources. Government can collect taxes and compliance withproper rules and regulations in business organisation. Government charges tax on incomeso for this there is need financial information. Suppliers – They are stakeholder because they are supplied raw materials and otherthings on time for fulfil requirement of company. If they provide on time so they try toreceive payments on time and they can also provide liquidity position due to credibility.So suppliers having stake in business organisation in form of their payments and sales.They need financial information in order to get their money on schedule time. Customers – Customers are important part an organisation who can decide growth andrevenues of an organisation. They are purchasing products of company and recommendedto other for product. They can buy products and services of company after usingdetermine their popularity, growth, quality, beliefs and performance therefore customersare holding performance and sustainability of business organisation. They can buyproducts of Investors – These are most significant part of an organisation because they are providingmoney on time and they can help to increase and growth of a company after investingmoney and other financial asset. Investors are actual stakeholders of company becausethey always try to get maximum return from investment made by in businessorganisation. They are investing money in company on the basis of financial position.(Zadek, Evans and Pruzan, 2013) . Creditors – The company can borrow money from creditors and provide secure interestin the company's assets. Creditors are ranked as stockholders to paid in the event of abusiness shutdown. In the terms of creditors there is including bond holders, suppliersand banks. They are interested in financial information because they invest in company.
CLIENT 11. Journal Entries and Ledger in the book of Alexandra StudySALES DAY BOOKDATEDETAILS£201803 January2018J Wilson1,200T Cole1,650F Syma2,100J Allen1,020P White2,520F Lane98009 January2018T Cole680J FOX1,310Credit in sales account in Nominal Ledger11,460PURCHASES DAY BOOKDATEDETAILS£201802 January 2018S.Hood1,450D Main2,060W.Tone960R Foot1,61022 January 2018L Mole1,830W Wright1,910Debit Purchases account in Nominal Ledger9,820PURCHASES RETURNS DAY BOOKDATEDETAILS£201819 January 2018R Foot50Credit purchases returns account in Nominal Ledger50
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