StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

Introduction, Review of Accounting Process and Financial Statements case assignment 1 - Essay Example

Cite this document
Summary
GAAP is a set of rules and regulations which have been developed to ensure that companies keep all the financial statements and reports in line with the needs of the users. The GAAP ensures that the reports of the company are reliable and comparable and also easily understood by…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER95% of users find it useful
Introduction, Review of Accounting Process and Financial Statements case assignment 1
Read Text Preview

Extract of sample "Introduction, Review of Accounting Process and Financial Statements case assignment 1"

Download file to see previous pages

Double Entry system of accounting is a standard used to record all the transactions at least in two accounts. This results in the one or more accounts being debited as well as credited. This system of accounting is very effective as it permits more accuracy in checking and also permits more balanced accounts. This is mainly because all the accounts with a debit balance need to equal the credit balance of the accounts as well (Burke & Litwin). The original monetary value of a good is referred to as the historical cost.

This has been criticized for a number of inaccuracies. Historical costing does not take into account the gains or losses unless they have been realised. However use of historical costing is very helpful and provides the management with a better view of the fair value of the item or also the market value. This helps the management make more informed decisions and make more educated strategies as well. Although historical costs have been very helpful for the management, there are a number of criticisms that relate to the same as well.

It has been noted that historical costs only considers the cost allocations and does not consider the value of the assets. Accrual basis accounting is one where all the transactions, i.e. the incomes and expenses are recorded when the transactions occur. On the other hand, cash basis accounting refers to the transactions that are recorded when the income or expenditure is received or paid. There is no focus on the date of the transaction. However the accrual basis is one of the most popular systems of accounting and is followed by most companies and is also required to be followed by law.

The accrual basis of accounting provides a clear picture of the financial state of the business. Current assets and liabilities refer to the short terms assets and liabilities, i.e. those that need to be settled within one year. On the other hand, a non current asset or

...Download file to see next pages Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Introduction, Review of Accounting Process and Financial Statements Essay”, n.d.)
Introduction, Review of Accounting Process and Financial Statements Essay. Retrieved from https://studentshare.org/miscellaneous/1569730-introduction-review-of-accounting-process-and-financial-statements-case-assignment-1
(Introduction, Review of Accounting Process and Financial Statements Essay)
Introduction, Review of Accounting Process and Financial Statements Essay. https://studentshare.org/miscellaneous/1569730-introduction-review-of-accounting-process-and-financial-statements-case-assignment-1.
“Introduction, Review of Accounting Process and Financial Statements Essay”, n.d. https://studentshare.org/miscellaneous/1569730-introduction-review-of-accounting-process-and-financial-statements-case-assignment-1.
  • Cited: 0 times

CHECK THESE SAMPLES OF Introduction, Review of Accounting Process and Financial Statements case assignment 1

A Service-Oriented System for Distributed Data Querying: MOTO Company

The industrial climate is under review.... The following report “A Service-Oriented System for Distributed Data Querying: MOTO Company” summarizes the existing data of the client MOTO Company.... The author has used vast resources as an international consulting firm.... He looks at various locations....
26 Pages (6500 words) Assignment

Preparation of Financial Statements in Compliance with Company Law

Different bodies provide the guidelines for preparing the financial statements.... The reason for the framework for the preparation of financial statements is the difference in laws… In a bid to ensure conformity and uniformity, bodies such as the International Financial and Reporting Standards prepared rules and regulations that should be followed when preparing the financial statements (Foster & Greenawalt 1995, pp.... Based on the company's financial statements, first, three areas of heightened audit risk will be identified, and a quantitative analysis provided....
6 Pages (1500 words) Assignment

Financial Statement of Real Good Food Plc

On that note, the assignment presents analyses of the financial statement of Real Good Food PLC with respect to the Real Good Food PLC is a heavily diversified company that manufactures and distributes a variety of products like sugar, baking ingredients, dairy products, jam and sweet bakery products (Real Good Food PLC 2015).... That is, the income statements, the statement of financial position, the statement of cash flow and the… In addition, the four accounts are accompanied by other notes such the auditor's report, the director's report, etc....
7 Pages (1750 words) Assignment

The Analysis of Audit Strategy Report for Solid Bank

"The Analysis of Audit Strategy Report for Solid Bank" paper is presented in two parts – relevance of assignment with relevant guidelines of ISA (the United Kingdom and Ireland) that are ISA 300, ISA 315 & ISA 330, and internal controls to be assessed.... Any misunderstanding in our terms with client or integrity issues among those charged with governance & management that may potentially compromise the independence of the auditors should prevent us from proceeding with this audit assignment....
6 Pages (1500 words) Case Study

The Social and Environmental Report of General Motors Plc

Thus, in GM's case, the data should be reliable because the readers (i.... In the case of corporate social responsibility and social and environmental reports of various companies, reliability is a key factor that makes these reports more believable to their readers.... “Unverifiable statements or data that affect the broad messages in a report…may compromise its credibility…....
9 Pages (2250 words) Assignment

Glaxo Smith Kline

This assignment "Glaxo Smith Kline" provides a critical review of the following aspects of the business of GSK in the past three years; its overall financial performance and dividend policy for its valued shareholders.... Hence, they have made 'Brand innovations and adjustments in their marketing / advertising strategies' to enhance their reputation and goodwill in the marketplace while accomplishing their goal of reaping financial benefits and excessive profits simultaneously....
8 Pages (2000 words) Assignment

Intrinsic and Extrinsic Motivation

The author of the paper will begin with the statement that as the recent recession is slowing starting to become an image in the economic rearview mirror, the realities of corporate performance begin to take center stage.... A key area is what this means to the average employee.... hellip; According to forecasts prepared by Mercer Consulting wages across the European Union are projected to increase by 2....
8 Pages (2000 words) Assignment

The Current System Utilized by Tracksuits-N-Sportswear Company Limited

To solve the problem of handling consumer credit, the system shall be connected with a credit reference bureau server such that credit appraisal can be automated and that the credit worthiness customers can be effectively established, without undergoing rigorous process.... The module shall serve as providing and input for strategic decision making, this shall provide decision support in terms of what products to produce, how it should be customized, and the amount of inventory, credit worthiness determination, strategic pricing of the commodities and how to process payments....
11 Pages (2750 words) Case Study
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us