battle royale ps4 free to play June financial accounting an integrated approach 6th edition pdf free The results would be scrutinised in depth, and further analysed to provide deep insight into the enterprise. Financial position: as provided by the balance sheet.">
Welcome to Reddit, the front page of the internet. Become a Redditor and join one of thousands of communities. Want to add to the discussion? Post a comment! Listed below are balances for Transportation costs. Net profit. Matching financial statement items to statement categories. Raindrop Holdings Ltd is a public company. Below are items taken from its recent consolidated balance sheet and consolidated income statement.
Note that different companies use slightly different titles for the same item. Property plant and equipment. Matching cash flow statement items to categories. The following items were taken from a recent cash flow statement. Mark each item in the list as a cash flow from operating activities O , investing activities I or financing activities F. Accounting equation. Mr Smiles opened his fruit shop at the beginning of last year.
By the end of that year he had the following assets and liabilities:. Total Assets. Supplies Payable. Wages Payable. Total Liabilities. The accounting equation.
What are its total liabilities as at 30 June. Use the accounting equation to answer the following questions. During the last financial year, Sparkle Industries tripled the amount of its assets. What was the amount of total assets at the beginning of the year? Income statement. Given the following information, prepare an income statement for Gerke Ltd for the year ended 30 June Training expense. Gerke Ltd Income Statement for the year ended 30 June Sales revenue Less cost of goods sold Gross profit Less operating expenses.
Given the following balances, prepare an income statement for the year ended 30 June for Bush Traders. Bush Traders Income Statement for the year ended 30 June Sales revenue Less cost of goods sold. Gross profit Less operating expenses. Taxes payable. Land and buildings.
What is the profit figure for the year? Cash Accounts receivable Inventory Land and buildings Total assets. Net assets. Analysing revenues and expenses and preparing an income statement. At the end of June , you find for June only this information:. On the basis of the data given disregard income taxes , what was the amount of net profit for June? Show computations. Cost of Goods Sold.
Gross profit. Gomez Limited has the following assets and liabilities. Accounts Payable. Assets Cash Accounts receivable Equipment. Cash and cash equivalents. Identify some accounting concepts and principles. Identify the accounting concepts or principles that relate to each of the following sentences and explain what effect the concepts or principles have on financial statements:.
Here are some ideas in response to the sentences. Some effects on financial statements of this are: accountants are careful that all cash transactions and day-to-day events such as credit sales and purchases are reflected in the financial statements; considerable care is taken to minimise errors and omissions in the accounting system that underlies the financial statements; and auditors ensure that important financial statement data can be traced back to underlying events and evidence.
Conservatism results or should result in financial statements that contain prudent, not overly optimistic estimates of future cash inflows and outflows regarding present assets and liabilities.
Reliability has the effect of keeping conservatism in check so that the financial statements are not pessimistic which would be unfair to present owners and managers. Matching says that estimates affecting revenues should be done on comparable bases to those affecting expenses so that the net profit makes sense, so it puts some bounds on conservatism too.
The objective of consistency over time results in highlighting inconsistencies so that the user can consider their effects on the information. Disclosure has the effect of helping users understand how the accounting numbers were computed.
This helps to make estimates of future effects. Understandability requires that reports be prepared so they are comprehensible to the recipients. The goal of both is partly to minimise the effects of human error, biases and wishes on the information by promoting objective, careful methods of preparing it and making it possible in principle for anyone else who prepares it to come up with, and agree with, the same information.
Accounting assumptions. Consider the following statements relating to how we might account for certain transactions or events. What accounting assumption or principle underlies each? In that case, inventory is written down to the net realisable value. Qualitative characteristics. The Framework for the Preparation and Presentation of Financial Statements examines the characteristics of accounting information that make this information useful for decision-making.
It also points out that various limitations, which are inherent in the measurement and reporting process, may necessitate trade-offs between these limitations and the positive characteristics of useful information. For each of the following pairs of information characteristics, give an example of a situation in which one of the characteristics may be sacrificed in return for a gain in the other:. Relevant information is capable of making a difference in a decision.
Relevant information helps users to make predictions about the outcomes of past, present, and future events, or to confirm or correct prior expectations. Information must also be timely in order to be considered relevant. Reliability is one of the two primary decision-specific characteristics of useful accounting information. Reliable information can be depended upon to represent the conditions and events that it is intended to represent.
Reliability stems from representational faithfulness and verifiability. Representational faithfulness is correspondence or agreement between accounting information and the economic phenomena it is intended to represent.
Verifiability provides assurance that the information is free from bias. Understandability is a user-specific characteristic of information.
Information is understandable when it permits reasonably informed users to perceive its significance. Understandability is a link between users, who vary widely in their capacity to comprehend or utilise the information, and the decision- specific qualities of information. Comparability means that information about enterprises has been prepared and. Comparability enhances comparisons between information about two different enterprises at a particular point in time.
The suggestions below are intended to serve as examples. However, they would not be as reliable as historical cost information about past transactions. Judgement is required in determining the optimum trade-off between relevance and understandability. Information about the impact of general and specific price changes may be highly relevant but not understandable by all users. Primary assumptions made in preparing financial statements. Kelly opened a photography business in a small shop that she rented from a large retailer, Eastfield Limited.
At the end of the first month of business, Kelly prepared the following financial statements. Identify the assumptions that Kelly has violated, and explain how each event should have been handled.
Prepare a corrected balance sheet and income statement. Assumptions violated:. Cameras have been shown as both an asset and an expense. As their life is longer than one month they should not be expensed. Rent paid. Balance Sheet as at 31 May Assets Cash Equipment Accounts receivable. Sales revenue Less operating expenses Rent Net profit. Discuss ethical problems. Discuss the examples of ethical problems given at the end of section 1.
What ethical issues do you see? What do you think the chief accountant, the auditor and the general manager should do? Employee lawsuit and chief accountant Ethical issue: The chief accountant has a responsibility to the users of the financial statements and to the company. The question that arises here is whether the potential effects of the lawsuit will affect the decisions of users of the financial statements. Will disclosure of the lawsuit in financial statements affect the outcome of the lawsuit?
Will disclosure result in other lawsuits by previously dismissed employees? What should the chief accountant do? Why does the general manager deny any impropriety? Why does the chief accountant personally feel the claim is justified? What is the amount of the potential claim? Is it large enough to make a difference to the users of the financial statements? The information provided by the lawyers would include the amount and likelihood of any gains or losses.
Since auditors performing an audit rely in part on representations of management, the potential dishonesty may jeopardise the effective conduct of the audit. What should the auditor do? If the enterprise is not purposely cheating the customer, the auditor can bring the error to the attention of management and the problem will be solved.
If top management is not involved and is unaware of the circumstances the auditor can bring the matter to the attention of top management. At this point, top management would hopefully do something to rectify the situation. The auditor should do a number of things at this time, including seeking advice and discussing the situation with top management.
Further action by the auditor is dependent on the response of management and whether the incident is isolated or not. As a result, it will not change the amount of cash generated from operations of the enterprise before considering the amount of. The proposed change will increase the amount of cash paid out to the general manager by way of bonus. Should the general manager get a higher bonus, if nothing has really changed?
Perhaps the new depreciation method results in better matching of expenses with revenues. Or, perhaps the new depreciation method is similar to depreciation methods used by other enterprises in the same industry. This would result in enhanced comparability between enterprises and may be more useful to users of the financial statements. What should the general manager do? If this is the case, the accounting change should be implemented.
If not, the change should not be implemented. For example, if the general manager ensured that the relevant assets were well maintained to the point that the useful life of the assets was extended, the general manager should be rewarded for this performance and the bonus calculation should not ignore the change.
CASE 1A. Woolworths Limited. All questions relate to the consolidated accounts. Who is the auditor for the company? Answer 1A. In addition the cash flow from operations includes revenues and expenses relating to. CASE 1B. Wings Ltd is an airline services company with a plant near Sydney Airport and service centres in several states. Search WorldCat Find items in libraries near you.
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