Owners put in their money to make a profit this is why it is important for them to track the sum of money they may have made in an accounting period. Usually a supervisor’s standing is related with the success of the company. When a business is making money the amount of money a manager makes will usually increase and they may also get a promotion. Income statements are also used to check the revenues and expenses of the company which allows managers to reduce their unnecessary expenses to make more profit. These income statements are also useful for outside users such as investors, creditors and the government.
Income is an important area of budgeting, this because without income there is no money to work within. It is necessary to raise the amount of income that is available for the budget. To do this the business could sell more products or raising prices. If costs are higher but income is not increased then this means that the profits will be affected. A business with a proper budget should be able to pay its expenses and keep
Their interest is to see the profit they make increasing and the value that the business has rising. Like other stakeholders they want to business to have a good reputation and to grow. Pressure groups the business on making decisions which help defend the environment e.g. Green peace and friends of the world. Environment concerns are important for pressure groups so they try brought onto the business and also protest against the businesses.
In this task I was asked to tell Shafal the importance of cost, revenue and profits are all important to running a business. In section b I was asked I was asked to give examples what would happen if the Shafal does not bring revenue and she doesn’t make profit. Profit means the amount left from sales revenue after deducting the cost of producing the goods and services. The importance of profit for Shafal is that this canhelp the business to expand byreinvesting the profits in to the business. If she makes profit she can invest in new equipment or machinery e.g.
As Sainsbury's have a hierarchical structure they are most likely to lose a lot of money because for the marketing and research and development departments to carry out their functions they would need funding from the finance department. For this information to get to the finance department a lot of time would have been wasted and also for the finance department to reply to them, all this would cost them a lot of money. Advantages of Sainsbury's is that the power they have would be successful for the business as when work is being done the communication of the workers together when given commands from the manager and having to work better for the manager to impress them in order for more work to be done and at a more well-organized rate then if there was no pressure from the manager. Disadvantages would be that the workers would start to get stressed from having to complete the workload at too fast a pace for them to work at all times that they will start to work less and dislike there job and some days may not want to work as they are stressed to do work which is too much for them to cope as they are trying too hard to impress, this could lead to employees wanting to quit their job. Advantages are that when having to complete work set out by the manager to the employees it can be done efficiently so that the manager will be able to assess the employee and they could get a promotion to a higher part of their job.
Scholars such as Friedman suggest that treating the economic responsibility as the most important responsibility of a business, is called a profit-maximising view, and “the social responsibility of a business is to increase its profits.” This kind of view states that a company should be operated on a profit-orientated basis, with its sole mission being to increase profits. This approach would seem to benefit stockholders, as well as stakeholders, as the stockholder is going to benefit from the profit made by the company and will gain something back from the company, however problems can occur when the businesses and companies do not balance their ethical responsibility, as they can therefore be perceived as greed and unable to balance their corporate social responsibility, and will cause a bad name for a business. So although the stockholder may also be gaining profit by doing this (what the company sees as doing the right thing) is not necessarily the right thing to do in terms of stakeholders. However, Friedman would argue that as long as the business is maximising its profit, that is the main point and so the loss of the stakeholders is less important. This argument can be deemed as weak as Friedman’s approach does not mean that stakeholders can be benefited alongside stockholders, and so disagrees with
Substantive Procedures for Cash Outflow Irregularities ACC/566 Forensic Accounting September 13, 2014 Businesses have goals that include making a profit. In order to have a profitable business, it must be one that offers goods and services that are appealing to the people. When this occurs, there is a demand for the products and services and in some cases a need. Because the financial industry has its ups and downs, businesses must comply with certain rules and regulations in order to stay in business. Not only should they adhere to these guidelines and laws set forth, but they must internally protect their assets or prized possessions in order to continue the inflow of prosperity.
To see these benefits, the focus needs to remain on benefiting the community at large and meeting the needs of each individual location. Crime can be reduced within the store by helping provide for the community and offering opportunities to help people work their way off the streets. Consumer spending can be increased by meeting the demands of the area while helping those who cannot afford to spend money on the goods the company sells. Any company would be wise to remember that quite often it is the poor who succeed later in life and become a company’s biggest investors. A focus on those in need is something that helps a company’s reputation for years to come, boosting profits in both the poorest neighborhoods and the wealthiest.
1. Reflect and describe which key concepts and topics in this course have made you a stronger candidate to enter the business world. A few important concepts that this course covered are gross income inclusions, gross income exclusions, deductions and losses, and itemized deductions. The ones I believe have made me a stronger citizen in general are employee expenses and deferred compensation, itemized deductions and capital gains and losses. Capital gains and losses are important to understand because it can directly affect and individual or a business adjusted gross income.
Cash Inflows Income from sales: The money earned from selling goods and services creates an inflow of cash to the business. This is often called sales revenue or turnover. Loans from banks: it is common for a new business to borrow money in order to buy new items such as vehicles, machinery or property. When the loan is given to the business, this becomes a cash flow for the business. Money invested by the business’ owners: When a business is first started, its owners (sole traders or shareholders, for example) may invest money into the business, resulting in a cash flow.