The Scope Of Financial Accounting

15 Pages3862 Words115 Views

Added on 2021-02-22

The Scope Of Financial Accounting

Added on 2021-02-22

BookmarkRelated Documents

FinancialAccounting

Table of ContentsINTRODUCTION...........................................................................................................................1TASK 2............................................................................................................................................1P3 Prepare final accounts with the help of given trial balance....................................................1P4 Production of final accounts for range of examples...............................................................4TASK 3............................................................................................................................................6P5 Apply the bank reconciliation process to prepare a number of bank reconciliation..............6TASK 5............................................................................................................................................9P6 Explain the process taken to reconcile control accounts and clear suspense accounts usinggiven account examples...............................................................................................................9CONCLUSION..............................................................................................................................12REFERENCES..............................................................................................................................13

INTRODUCTIONCollection, allocation, bifurcation and recording of financial transactions and information inappropriate format is considered as a financial accounting. Financial reporting is essential fororganisations in order to track the financial operation and performance of entity. With the crucialrequirement of financial governance, the rules and principles of financial reporting also becomebroad in nature (Barron, Chung and Yong, 2016). This report explains the scope and importanceof monetary accounting in the direction of effective decision making and structure planning. Keyfinancial areas as preparing of final accounts, bank reconciliation statement and control accountsare covered in this report. Major criteria of this report is focused upon formation of financialaccounts for sole traders, partnership firms and limited companies. Relevant accounting conceptsand principles in order to maintain the ethics while preparing accounts also covered in thisreport. TASK 2P3 Prepare final accounts with the help of given trial balanceFinancial statement: It can be defined as the accounts which are generated byaccounting professionals of companies in order to facilitate the internal as well as externalstakeholders to determine actual position of the company. There are two main types of themwhich are as follows:Income statement: It can be defined as a statement which is used for the purpose ofrecording all the incomes and expenses of a company that are faced by it in a specifictime period. With the help of it stakeholders such as share holders, customers employeesand managers can assess that organisation is facing losses or generating profits. It isbeneficial for investors because it guides them to analyse ability of the enterprise toprovide them good returns on the money which will be invested by them in the business(Chan, 2015).Balance sheet: It is also known as statement of financial position which helpsstakeholders to monitor that the organisations is financially strong or weak. All the assetsand liabilities are recorded in it by the accounting professionals which are hired bycompany to formulate financial statements. Shareholders and investors analyse it to1

determine that the enterprise in which funds are invested by them is using themappropriately or not.Statement of profit and loss for Munteanu Ltd.ParticularsAmountParticularsAmountTo opening inventory15000By Sales138000To Purchases61000Less: Return Inward3000135000Less: Return Outward150059500By Closing Inventory20000To Gross profit80500Total155000Total155000To Administration Cost 32000By Gross Profit80500To Distribution Cost32000To Depreciation8800To Finance Cost1500To Tax2000To Net Profit4200Total80500Total80500Statement of financial position for Munteanu Ltd.AssetsAmount in EURLand 20000Building40000Less: Accumulated Depreciation1000030000Depreciation for the year80029200Plant and machinery60000Less: Depreciation2000040000Depreciation for the year800032000Total non-current assets81200Inventories20000Prepaid Rent30002

End of preview

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

Unit 10 - Financial Accounting

|19

|4976

|94

Business Report Financial Accounting Assignment

|23

|5918

|49

FINANCIAL ACCOUNTING PRINCIPLE INTROUCTION 1 PART A1 Business Report

|36

|9395

|326

Preparation of the final accounts of Carol Andrew

|16

|4595

|222

Financial Accounting Principles Assignment - Airdri company

|30

|6507

|439

Financial Accounting Principles and Concepts

|38

|3915

|73

The Scope Of Financial Accounting