Recording Business Transactions

Recording Business
Transactions
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Table of Contents
Introduction......................................................................................................................................3
Assessment 1....................................................................................................................................3
Part 1.......................................................................................................................................3
Part 2.......................................................................................................................................5
Part 3.......................................................................................................................................6
Part 4.......................................................................................................................................8
Conclusion.......................................................................................................................................9
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Introduction
Accounting is primarily concerned with recording and summarising events that are of the
financial nature in the books of accounts. These financial data are then interpreted to prepare
various financial statements and reports which is then further used by management and investors
to make informed decision. This assessment is aimed at demonstrating recording of business
transactions in books of accounts like journal and ledger to prepare trial balance and income
statement. Further, decision-makers in Google LLC are identified and their usage of accounting
information is discussed. Advantages and disadvantages encountered by accountants while
recording accounting information and the impact of Covid-19 on the profitability of the business
are also discussed in the assessment.
Assessment 1
Part 1
A. Decision-makers in Vodafone and the need of accounting information
Strategic decision-making of the company stems from its organisational structure and
inspires its organisational culture as well. Google follows a cross-functional organisational
structure which is a combination of matrix and flat structure. Decision-making is necessary at all
levels of management in a company but the strategic decision-making is made by top level
management of the company. Senior management needs to encompass both financial as well as
non-financial information while making a holistic decision. Google has a defined value structure
which guides all the decisions taken in the company. Senior management devises strategies
which are passed in the form of guidelines to middle level managers who are made further
responsible to pass on instructions to the teams working beneath them.
All the decisions that are taken by the board of directors of the company are either based
on the information analysed out of financial statements or influenced from it. Financial
statements i.e. income statement, statement of financial position and cash flow statement reflect
financial position and performance of the company. These are prepared by the accounts
department of the company as per the International Financial Reporting Standards (IFRS) and
used by finance managers to interpret so that they can further assist board of directors in making
effective decisions related to planning, operating and controlling. These accounts are used to
prepare budgets and forecasts i.e. historical information of the business is adjusted according to
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