Accounting objectives, Financial Accounting

Assignment Help:

Accounting objectives

Accounting has two main objectives:

  • To assist control over the assets and liabilities, and the income and expenditure of the enterprise; and
  • To ascertain the profit or loss of the enterprise, the main sources of income and expenditure contributing to this profit or loss and the assets and liabilities that represent the profit or loss.

 

If the owners of an enterprise want it to earn more profit, they must increase the volume of turnover. As turnover increases, the enterprise must expand physically; as it expands, it will create departments, which deal with different lines of sales or services; there is a limit to the physical expansion at a single site–and the market there is also limited. Hence, enterprises set up branches, so that expansion can be continued. The need then arises to control the assets, liabilities, income and expenditure of the different departments and/or branches.


Related Discussions:- Accounting objectives

Determine the accounting aspects of business, Determine the accounting aspe...

Determine the accounting aspects of business Accounting scandals can have a profound effect on all those connected with business. Enron scandal, for instance, ultimately led t

Vat, a recommendation regarding the current south African vat system

a recommendation regarding the current south African vat system

As an expense and an asset-survivorship policy, As an expense and an asset ...

As an expense and an asset This approach tries to resolve the differences between the two methods by ensuring that we show an asset that may materialize or crystallize and at t

Bell mountain vineyards is considering updating, Bell Mountain Vineyards is...

Bell Mountain Vineyards is considering updating its current manual accounting system with a high-end electronic system. While the new accounting system would save the company mon

Failure to record depreciation at year ?, Failure to record depreciation at...

Failure to record depreciation at year end will result in all of the following except Understatement of total liabilities. Overstatement of total assets. Overstatement of net incom

Calculate the sales needed to earn a profit of 20% on sales, Question: ...

Question: The following data are obtained from the record of a factory:                                                        £                   £ Sales 4,000 units @ £2

What amount should emig report in its 2011 income statement, On its Decembe...

On its December 31, 2010 balance sheet, Emig Corp. reported bonds payable of $6,000,000 and related unamortized bond issue costs of $320,000. The bonds had been issued at par. On J

Journal entry for company, 1. Think about the transactions listed below. a....

1. Think about the transactions listed below. a. A company obtains a $10,000 loan from a bank. b. A company purchases $15,000 of inventory from its suppliers. They paid $5,000 toda

Maturity risk premiums , Suppose that the real risk-free rate, r*, is 4% an...

Suppose that the real risk-free rate, r*, is 4% and that inflation is usual to be 8% in Year 1, 5% in Year 2, and 4% thereafter. Suppose also that all Treasury securities are highl

Journalizing, Purchased used truck for 8,000 ,paying 2,000 cash and the bal...

Purchased used truck for 8,000 ,paying 2,000 cash and the balance on account

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd