Unit 5007 Financial control 1.1 Assess the relationship(s) between a financial system or function and other systems or functions in an organisation Answer: Information and records are of critical importance to the functioning and controlling of systems in general‚ including organisational systems. Given the central importance of information and records to systems operation‚ including public sector organisations and the societies they exist to govern‚ we should not be surprised
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net sales is called i. vertical analysis j. horizontal analysis k. liquidity analysis l. common-size analysis 5. A balance sheet that displays only component percentages is called m. trend balance sheet n. comparative balance sheet o. condensed balance sheet p. common-sized balance sheet 6. One reason that a common-size statement is a useful tool in financial analysis is that it enables the user to q. judge the relative potential
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UVA-C-2332 Rev. Oct. 17‚ 2012 RATIOS TELL A STORY—2011 Financial results and conditions vary among companies for a number of reasons. One reason for the variation can be traced to the characteristics of the industries in which companies operate. For example‚ some industries require large investments in property‚ plant‚ and equipment (PP&E)‚ while others require very little. In some industries‚ the competitive productpricing structure permits companies to earn significant profits per sales
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hypothesis and its implications on the information perspective of accounting. As information perspective was later replaced by the measurement perspective‚ we will discuss recent accounting measurement issues‚ including fair value accounting and off-balance sheet liabilities. Positive accounting theory‚ earnings management‚ executive compensation and economic consequences of standard setting will be covered in the last part. Financial Accounting Theory is a rigorous subject requiring not only accounting
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number included on it. 2. Discuss with the sales manager whether any sales allowances have been granted after the balance sheet date that may apply to the current period. 3. Add the columns on the aged trial balance and compare the total with the general ledger. 4. Observe whether the controller makes an independent comparison of the total in the general ledger with the trial balance of accounts receivable. 5. Compare the date on a sample of shipping documents throughout the year with related
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Balance Sheet and Income Statement Commentary BSA/500 – Business Systems I July 2‚ 2012 Balance Sheet and Income Statement Commentary JB Hunt (Trucking and logistics) On JB Hunt’s balance sheet for 2011 lists current assets of $513‚542‚000 and current liabilities of $438‚515‚000‚ yielding a current ratio of 1.17‚ which indicates the company‚ has $1.17 of current assets for every $1 of current liabilities. The previous year 2010‚ the current ratio was 0.91. This shows a 29% increase in the
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Classification of Assets and Liabilities in a Balance Sheet We all know that Balance sheet tells us the financial position of a business at a particular point of time. The accounting equation i.e. Assets = Liabilities + Capital forms lays the foundation for the preparation of Balance Sheet. Everything that the business owns are its assets. Alternatively‚ whatever amounts a business owes to outsiders become its liabilities. First let us see how these assets are to be classified. Current
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How did the corporate culture of Enron contribute to its Bankruptcy? Once a sound company listed in fortune 500‚ Enron‚ lead to downfall because of deceptive accounting system incorporated within the organization. Enron’s dubicious finance finally collapsed in Dec 2‚ 2001 as it filed Bankruptcy in New York Bankruptcy court. The corporate culture of Enron focused on financial performance neglecting the stakeholder’s value .The relentless emphasis on the importance of the shareholder’s value created
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statement and balance sheet. Their preparation is also desirable but not compulsory. However‚ they are generally prepared. In the case of trading concern‚ a trading account and in the case of a manufacturing concern‚ a manufacturing account and a trading account can also be prepared. In such a case‚ the account heading is mentioned as follows: Manufacturing/trading and profit and loss account. In the case of joint stock companies’ preparation of the profit and loss account and balance sheet every year
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statement would not show A) the retained earnings beginning balance. B) revenues and expenses. C) dividends. D) the ending retained earning balance. 3. Net income will result during a time period when: A) assets exceed liabilities. B) assets exceed revenues. C) expenses exceed revenues. D) revenues exceed expenses. 4. Which of the following is not a common way that managers use the balance sheet? A) To analyze the balances of assets‚ liabilities‚ and stockholders’ equity throughout
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