Accounting System and Process - Finance Assignment Solution Example

This document presents a comprehensive solution to an accounting system and process assignment. The solution covers several key areas, including the use of spreadsheet formulas for financial calculations, the representation of negative numbers, and the application of the IF function. It explores periodic inventory systems, demonstrates the creation of financial statements (income statement and balance sheet) using spreadsheets, and illustrates the reconciliation of bank statements. The assignment also includes journal entries for accounts receivable, methods for determining bad debts, and an analysis of a company's turnover ratio. Furthermore, the solution incorporates a case study of Wesfarmers Group, analyzing its financial statements, including the statement of comprehensive income, and providing advice for a potential investor. Finally, the assignment provides an overview of the company's risks, sustainability, and financial ratios such as working capital ratio and profit after tax.

Running head: ACCOUNTING SYSTEM AND PROCESS
Accounting system and process
Name of the University
Subject code and name ‘
Student Name and ID
Assignment Task Number
Author Note

1ACCOUNTING SYSTEM AND PROCESS
Table of Contents
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References:............................................................................................................................................14

2ACCOUNTING SYSTEM AND PROCESS
Answer 1:
Though the names, the user can make the formulas much easier to maintain and understand.
The names can be used for function, cell range, table or constant (Brigham & Ehrhardt, 2013). Once
the cells are named, it can be used for audit, manage and update these cells.
Answer 2:
Negative numbers can be displayed through parentheses, minus sign or application of red
color. To present the negative numbers the range of cells or the particular cell must be selected first
and after that through pressing the CTRL+1, the currency or number shall be selected and finally
under the negative numbers, the negative number option shall be selected (Arnold, 2013). The
negative numbers are represented under bracket rather than with minus sign to represent it more
clearly.

3ACCOUNTING SYSTEM AND PROCESS
Answer 3:
It becomes simpler for the user of the spreadsheet to to enter the data appropriately under
different columns particularly for recording the inventory (Brigham, 2014). Further, the data area and
report area make the user able to differentiate the processed and unprocessed data through
differentiation of report area and data area.

4ACCOUNTING SYSTEM AND PROCESS
Answer 4:
Under excel, the IF function is utilized for analyzing some functions and establishing the fact
that whether the specified fact is fulfilled or not. It is regarded as the logical function under the
spreadsheet and that logical function may either be ‘FALSE’ or ‘TRUE’. It is TRUE when the
condition is fulfilled and vice versa (Bryce, 2017).
The following spreadsheet shows the example of an IF function under the normal view:
The IF function under the formula view can be shown as follows:
Answer 5:
Periodic systems of the inventory:

5ACCOUNTING SYSTEM AND PROCESS
It is the system of maintaining the inventories. Under the periodic inventory system, the
inventory level and the cost of goods sold details are not updated on continuous basis. Instead, the
sales and purchases transactions are recorded through the single journal entry at the closing of the
period (Baños-Caballero, García-Teruel & Martínez-Solano, 2014).
The example is given as follows:
Answer 6:
Fancy Footwear- 10 column-adjusted worksheet in the normal view:

6ACCOUNTING SYSTEM AND PROCESS
Fancy Footwear- 10 column-adjusted worksheet in the formula view:
Statement of Income as a normal view:

7ACCOUNTING SYSTEM AND PROCESS
Statement of Income as a formula view:

8ACCOUNTING SYSTEM AND PROCESS
Balance Sheet in normal view:

9ACCOUNTING SYSTEM AND PROCESS
Balance Sheet in formula view:

10ACCOUNTING SYSTEM AND PROCESS
The uses of the spreadsheet as an accounting tool:
 The user can make various calculation and solve different equations through the spreadsheet
formula
 Graphs and charts can be used to determine the trends
 Data for various financial statement can be compared
 The data can be formatted, hidden or edited through the spreadsheet (DRURY, 2013).
Answer 7:
Inventory in the normal view:

11ACCOUNTING SYSTEM AND PROCESS
The calculation of Gross Profit as a normal view:
Inventory as the formula view:
The calculation of the Gross Profit as the formula view: