Accounting Analysis
Accounting analysis refers to the accounting information provided by accounting, the application of certain analytical methods, the business process and its business results of quantitative and qualitative analysis. The result of accounting analysis is the main basis for accounting forecasting and accounting examination.
Note on Accounting policy (From the Emirates Airline Annual report):-
-Inventory Valuation: Inventory Valuation gives the company's inventory item a monetary value. The enterprise’s largest current assets is inventory, so it must be properly measured to ensure accurate financial statements.As the inventory items has been sold and restocks and the cost of the inventory items are changing ongoing , the
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Its value is it cost, need to be included in the cost of the product. Depreciation of fixed assets refers to the system of apportionment of accrued depreciation in accordance with the method of determining the useful life of fixed assets. Life is the estimated life of a fixed asset, or the quantity of the product or service provided by the fixed asset. Depreciation is only cost analysis, depreciation is not the valuation of assets, which itself is neither a source of funds, nor is the use of funds, therefore, depreciation of fixed assets does not bear the renewal of fixed assets. However, due to the depreciation method will affect the enterprise's income tax, which will also have some impact on cash flow. Depreciation of fixed assets is not all fixed assets are depreciated, depreciable fixed assets should have the conditions: the useful life is limited and can be reasonably estimated, that is fixed assets in the use of the process will be gradually lost until the use of value.According to the report from Emirates Airline,the land is not depreciated. And other items of property, plant and equipment is depreciated under straight-line
In order for Jim Turin & Sons, Inc to have used this method of accounting it would have had to match the cost of the merchandise with the revenue earned from the sale. Using the matching of revenue and cost the company would have had to have kept an actual inventory and maintained records of the costs associated with said inventory. Since the costs are not immediately deducted under the accrual method they are deferred to the year when the merchandise is
In Inventories are sold, and they are purchased on a continuous basis. Due to the varying market conditions, the prices of the inventories may change and as a result, valuation of inventory is imperative. There are various methods that organizations use in valuing stocks. The most common methods are:
a computer, is lower than its net realisable value (the estimated selling price). This is because in the notes of the Balance Sheet under Inventories it states, “Inventories are stated at the lower of cost and net realisable value.” The Plant and Equipment asset uses an alternative method which is cost minus accumulated depreciation minus impairment (when companies compare the market value with the value written down). Impairment is only used when the company feels necessary. Lastly Intangible assets, JB Hi-Fi use an alternative method which is cost minus accumulated impairment. For example JB Hi-Fi in New Zealand cost 14.7 million in 2016 but due to impairment charges in the current year it cost
Different inventory accounting method may have different impacts on Airline company like Qantas. Due to the complexity of the aircraft system and also to ensure the airline operation safety, airlines need to devote a great deal of manpower and material resources to maintain and repair the aircrafts. Inventories such as aircraft components play significant role in repairing and maintaining aircrafts, which is the basis for achieving the goal of on-time flight. So it is a very important
Selecting the valuation method for reporting and valuing is based on key issues relating to the relevance and reliability of the method of accounting for that item. According to finetuning.com (2005) "how you identify items in inventory and determine which have been sold will depend on the nature of the products, the volume of the products, how they are tracked, and inventory rotation." Key factors to consider under the inventory policy are: location of storage facilities, temperature, security, rotation of stock, cost, training, periodic inventories, and control.
*"Accounting is a set of principles and procedures relating to the registration and compilation, analysis and interpretation of financial data for the purpose of determining the outcome of business and its financial position".
2-1 D. Given: Current Ratio = 2.2:1; Current Asset = $33,000, Non-current Asset = $55,000; Liabilities = $15,000
Accounting is the pillar of every company to measure its growth, loss, revenue , capital, its really specify the real terms in foam of figures and sometimes in tables, in accounting there are certain rules are obtained to make more accuracy while playing with figures.
...ow valuation has been correctly calculated to show the projected future cash inflow will greater than the present value of the company asset.
Two key disciplines in accounting are financial accounting and auditing. Financial accounting involves processes by which financial information about a business is recorded, classified, summarized, interpreted, and communicated (Wikipedia, 2005). Auditing is a related to financial accounting, but it is a separate discipline. "Auditing is the process...
Financial Accounting Financial accounting or ‘book-keeping’ is the process of recording financial transactions from the day-to-day operation of a business. The sale of goods to a customer and the subsequent settlement of the debt are two examples of financial transactions. Sales Accounting When credit sales are made to customers, a record needs to be kept of amounts owing and paid. Payment is normally requested with an invoice.
Depreciation allocates the assets cost or depreciable amount over the estimated useful life of the asset to the entity. It is not a process of asset valuation. The cost of the asset less the accumulated depreciation is not intended to give the current market value of the asset as the asset purchased is not intended for re-sale but use in the business.
The revenue/cost period-: Revenue and the cost period in accounting that the company get income from normal business activities. It’s referred to normal business income that the company got by selling their product and service.
Accounting is so important in our modern society. It serves a variety range of place in our society. It serves a variety range of place in our soceity, from school to hospital, from business firm to government agencies. It's also the main force in regulation of taxation and industrial activity. It serves a great aspects on the development of mass-production systems, any way, it's a very important term in our modern soceity.
ABC LTD COMPREHENSIVE INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2012 NOTE 2012 Revenue 2 828,500 Cost of sales 3 (460,000) Gross profit 368,500 Other income 4 2,500 Operating expenses 5 361000 Profit before income tax 10000 Income tax expense (30%) 3,000 Profit for the year 7000 Other comprehensive income change in revaulation surplus 38500 Other comprehensive income for the year, net of tax 38500 Total comprehensive income for the year 45500 ABC LTD STATEMENT OF FINANCIAL POSITION FOR THE YEAR ENDED 30 JUNE 2012 NOTES 2012 ASSETS Current assets Cash and cash equivalents 6 100500 Trade and other receivables 7 45,200 Inventories 8 87700 Other current assets 9 7000