Unit 05 Accounting Principles Assignment Help

  working in an accounting department.
●Students will also have the skills to generate basic financial statements from trial balances and produce accurate reports.
●Students will properly understand why the financial statements need to be interpreted for the investors, stakeholders, and stockholders and how to solve financial information to make informed decisions. Students will be able to prepare austere cash budgets. These are fundamental accounting skills one needs to have.

Vocational scenario

You currently work as an Assistant Accountant at Horizon Accounting Solutions (or your chosen organization), a growing firm that has steadily expanded its client base, primarily serving sole traders, partnership businesses, and non-profit organisations. Over the past year, the firm generated £30 million in revenue and is now targeting an ambitious goal of reaching £50 million this year.

In your role, you contribute to the company’s growth by conducting financial analysis, comparing performance data from different years, and preparing budgets to ensure the firm meets its financial benchmarks.

Recently, your supervisor, who is also one of the managers, assigned you the task of writing a blog post on the context and purpose of accounting. This post is designed to attract entrepreneurs and newly established businesses, helping them understand the crucial role accounting plays in their success.

Assignment activity and guidance
This blog post will contain topics like:
1.Examine the purpose of the accounting function within any organisation.
2.Assess the accounting function within the organisation in the context of regulatory and ethical constraints.
3.Evaluate the context and purpose of the accounting function.
4.Critically evaluate the role of accounting in informing decision-making to meet organisational stakeholders within complex operating environments.
5.You will prepare basic financial statements for a sole trader from the given trial balance of Sarah Thompson's business, as of 30 June 2024, the end of her financial year.

Sarah Thompson
Trial Balance As Of 30th June 2024

The following additional information as of 30 June 2024 is available:

1.At the close of business, inventory has been valued at £55,000.
2.Wages and salaries need to be accrued by £1,200.
3.Other operating expenses are prepaid by £400.
4.The allowance for receivables is to be adjusted to 3% of trade receivables.
5.Depreciation for the year ended 30 June 2024 is to be provided as follows:
oProperty: 2% per annum using the straight-line method.
oEquipment: 20% per annum using the straight-line method.

Your task is to:

Prepare Sarah Thompson’s statement of profit or loss for the year ended 30 June 2024.
Prepare her statement of financial position as of that date, using the appropriate adjustments.

Financial Statement Preparation for Green Valley Farm

You will prepare basic financial statements for a partnership business from the given trial balance of Green Valley Farm, as of 31 December 2024, the end of their financial year.

Green Valley Farm

Trial Balance As Of 31 December 2024

The following additional information as of 31 December 2024 is also available:

a)£300 is owed for fuel expenses.
b)£900 has been prepaid for rent.
c)Depreciation is to be provided for the year as follows:

Vehicles: 15%
Equipment: 10%
d)Inventory at the close of business was valued at £24,000.

Your task is to:

Prepare Green Valley Farm's statement of profit or loss for the year ended 31 December 2024.
Prepare their statement of financial position as of that date, using the appropriate adjustments.

Produce Donald Brown Brother’s statement of profit or loss and financial position for the year ended 31 December 2023, making appropriate adjustments.

Financial Statement Preparation for Harmony Community Center

You will prepare basic financial statements for a non-profit organization from the given trial balance of Harmony Community Center, as of 31 December 2023.

Harmony Community Center
Trial Balance As Of 31 December 2023

The following additional information as of 31 December 2023 is also available:

a)£400 is owed for program expenses.
b)£1,000 has been prepaid for administrative expenses.
c)Depreciation for the year is to be provided on property, plant, and equipment at 5%.
d)Inventory of supplies on hand at year-end is valued at £1,500.

Your task is to:

Prepare Harmony Community Center’s statement of profit or loss for the year ended 31 December 2023.

Prepare their statement of financial position as of that date, using the appropriate adjustments.

6.Choose any organization (public or private) whose financial statements are publicly available. This could be a corporation, a non-profit, or any other type of business that interests you. Access the annual financial statements of your chosen organization for the years 2022-23 and 2023-24. Ensure you have both the statement of profit or loss and the statement of financial position.

a)You are required to calculate & present following ratios:
Profit Margin Ratios.
Debt-Equity Ratios.
Return on Investment (ROI) Ratios.
Current Ratios
b)You are also required to compare and evaluate the performance over time using financial ratios concerning relevant benchmarks.
c)Critically evaluate information from financial statements to assess organisational performance using measures and benchmarks to make justified conclusions.

7.Prepare a cash budget for XYZ Ltd for the period from January to April using the provided sales, purchase, and wages data. Additionally, evaluate the benefits and limitations of budgets and budgetary planning and control for an organisation.

Data Provided:
Month    Expected Sales (£)    Expected Purchase (£)
Jan    60,000    48,000
Feb    40,000    80,000
Mar    45,000    81,000
Apr    40,000    90,000
Wages: £5,000 per month.
Bank Balance on 1st January: £8,000. Management's Fund Deficit Decisions:
1.If the deficit fund is within the limit of £10,000: Negotiation with the bank is an option.
2.If the deficit fund exceeds £10,000 but is within £42,000: The issue of debentures is preferred.
3.If the deficit fund exceeds £42,000: The issue of shares is preferred (within authorised capital limits).

8. Upon preparing a cash budget from the information above, identify corrective actions to problems revealed by budgetary planning and control and justify budgetary control solutions and their impact on organisational decision-making to ensure efficient and effective deployment of resources.

Learning Outcomes and Assessment Criteri

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