This also creates an accounting through my bank allowing me to keep checks and balance from the time of the pay deposit to each purchase made through the exchange. Store of Value. In my opinion, when I go through the reading, I think of a retirement account, such as an IRA or 401k. These accounts make it possible to set aside funds in order to be used after an individual completes years of employment and contributions of these account. This starts the process over with these monies becoming a unit of account, then as a medium of exchange.
Managerial and financial accounting Within in this paper, Team C will differentiate between two types of accounting, financial and managerial. Team C will do this by examining the two types of accounting, and referencing what type of information is provided by each style of accounting. The knowledge of how business use each type of accounting, and the decision that are made on the basis of each style will discussed within the paper. Financial accounting is a process of recording, summarizing, analyzing, and interpreting the financial transaction of an organization. It mainly involves preparation of the financial statements and starts from journal ends with making of income statement and balance sheet.
General and Commercial Basis Accounting Principles Generally accepted accounting principles (GAAP) state the standard framework of guidelines for financial accounting used in any given jurisdiction; commonly known as standard accounting practice or accounting standards. These contain the rules, standards, and conventions that accountants practice in recording, summarizing and in the preparation of financial statements. Hubpages.com discusses commercial accounting, also known as profit accounting, defining that it performs mainly by profit and loss. The reporting for a profit organization is directed to the investors. ("The Principles of Commercial Accounting and Fund Accounting", 2011).
Accounting is a way to communicate financial information about a business to those who wish to use the information to make decisions. Two types of accounting are management accounting and financial accounting. Management accounting is used by managers to run a business. Financial accounting provides information to various external users. (Horngren, 2012) Financial statements and their related disclosure notes provide information such as the results of operations, the financial position of the business, and cash flows.
An authoritative accounting that consist rules of accounting that are used in preparation and standardize reporting of financial statements in accordance with GAAP by the AICPA’s Code of Professional Conduct. To help reflect an economic position of the company and without GAAP company would be free to decide for themselves what financial information to report or how to report it. Investors and creditors will be able to make financial decisions when the company’s financials are comparable and understandable. The Hierarchy of Generally Accepted Accounting Principles is to identify accounting principles sources and structure for choosing the financial statements principles that should be utilize when their preparations developed by the FASB (Kiesco, Weygandt, & Warfield, 2007). Its governs what constitutes the major sources of which are GAAP: FASB Standards, Interpretations, and Staff Positions; APB Opinions; and AICPA Accounting Research Bulletins that falls under four categories A or D in descending order of authority: Statements and Interpretations, Technical Bulletins, Practice Bulletins and Implementation.
Choosing a financial planner C. Implementing a plan for achieving goals D. Developing short-term and long-term financial goals 6) Which of the following would be considered a transaction account? A. certificate of deposit B. savings account C. mutual fund account D. checking account 7) Which of the following is included in a typical financial plan? A. Photographs of your family B. A copy of your latest checking account reconciliation C. A copy of your driver’s license D. An estate plan, including a will 8) Which of the following is an advantage of using a debit card?
They are a governmental agency which requires companies to files financial reports that follow the rules of the GAAP. The SEC also mandates that specific guidelines will be used when situations have no principle. Double Entry Accounting is defined as a method that involves each transaction being recorded in at least two accounts, resulting in a debit to one or more accounts and a credit to one or more accounts. It provides a method to quickly check the accuracy because the sum of all accounts with debit balances should equal the sum of all credit accounts. This is one of the most commonly used methods by businesses
How stock options are set up There are two ways in which a company can set up an ESOP. 1. Create a Trust: In this case, the Company will issue shares or options to a trust depending on the number of options to be given to the employees. For this purpose the company needs funds, which can be acquired either by getting loans from the company or by raising loans from other sources for its financial requirements. The loans will be repaid when the employees purchase the options offered and
The financial side of accounting is used to represent the company’s current standing based on the past profits, net income, bad debts, and current ratio of assets to liabilities. The financial accounting represents a specific period of time, called the fiscal year, for the public to analyze the operating performance of the company. Financial accounting uses more concrete methods of operating by using the Generally Accepted Accounting Principles (GAAP). This set of principles is an international standard that all financial
The heart of the case is a model that is developed by the firm’s corporate treasury staff to help them think about the static tradeoff of tax shields and financial distress in a dynamic setting. The model includes the main sources of operating risks that the firm faces, including exchange rate risk and interest rate risk, and measures the impact of different capital structure policies on the firm value using Monte Carlo simulation. Questions Part I (50% of the grade) 1. Provide brief answers to the following questions. These are