Non-cash expenditure Essay Example for Free

Non-cash expenditure Essay CASE 1 The effectiveness of the conceptual framework for the Financial Accounting Standards Board is high. Unfortunately, its effect to outsiders is limited. As already stated, the conceptual framework will aid in the setting of accounting standards. However, only internal persons of the Financial Accounting Standards Board are involved in the standard setting process. Therefore such yardstick will only beneficial to them, because outsiders like accountants will have to abide with the standard issues. Indeed it is a normal trend that standards issued are adjusted in the future due to industrial factors that they omitted to consider or did not tackle properly. An argument in favor of the conceptual framework with respect to outsiders is that it enhanced the credibility of financial statements through the issue of objectives and concepts in such framework (Foster M. J. et al 2001, p 2). CASE 2 a) The cash basis of accounting is based on the premise that a transaction is recorded once cash inflow or cash outflows arises on cash and cash equivalents (Randall H 1999, p 247). On the contrary the accrual basis of accounting is based on the concept that revenue and expenditure are recorded once incurred and not when the cash receipt or payment arises (Randall H. 1999, p 191). For example, if license of a motor vehicle of $1,200 is paid in the beginning of November and the financial year-end is 31st December. Under the cash basis $1,200 is deducted. However, under the accruals basis only expenditure of $200 is recorded representing the expense incurred in November and December. b) The bank should always lend money in good faith. That is the money ought to be lend to persons who are financially capable to repay it in a given time frame. We should bear in mind that the money lent by the bank is coming from the depositors’ funds, which have in turn trusted the bank with their money. A fundamental principle of the code of ethical conduct of professionals states that the decisions taken by such parties should deter from providing harm to other parties and ought respect the rights of others (Association of Accounting Technicians 2007, p 7). Therefore if the bank manager of Ernest Banks knows that if the financial reports of the firm at hand are prepared on an accruals basis, which will eventually lead to lower profits. There is the risk that the financial ability of the company to pay the interest and capital commitments concerning the loan diminish. They should therefore take remedial action in order to mitigate such risk and thus safeguard the resources entrusted by depositors. c) The problem at hand identified in the previous question necessitates that the owner is informed of this issue as soon as possible. They ought to explain that the cash balance reported in the monthly bank statements does not represent the actual profit made by the business enterprise. Such illustration should be made in light of the weaker financial ability of the company to pay interest and capital commitments on the present loan that the firm will face in the nearby future. Since the business is experiencing growth there is still potential for the firm to mitigate the problem at hand. This stems the importance of informing the owner of such issue, who will take remedial action to solve it. However, the bank should refrain from providing specific solutions, since liabilities may arise if such solutions do not solve or possible even worsen the present financial performance of the company. CASE 3 1) The net increase in cash and cash equivalents originating in the cash flow statement is different from the net income portrayed in the income statement due to the different principles followed that where contrasted in the previous question of the former case. The reason for such disparity stem from a number of factors. For example, in the cash flow statement only the cash received from cash sales and debtors is recorded. In the income statement, all the sales incurred are taken into account. Similarly the cash payments for purchases, expenditure and to creditors are shown in the cash flow statement. However, in the income state all expenditure and purchases incurred in that time frame are taken into account (Lewis R. et al 1996, p 317). Non-cash expenditure like provision for depreciation and provision for slow moving stock are deducted from the profit figure. These are omitted from the cash flow statement since they do not represent cash outflows. Further more, capital expenditure incurred and paid during the period is recorded under the investing activities of the cash flow statement. This even though incurred is not portrayed in the income statement, but is recorded in the balance sheet due to its materiality and long-term effect. Hence it will affect cash flow but not net income. This thus clarifies the reason why the net income of $100,000 significantly differs from the actual cash flow balance depicted in the cash flow statement. 2) The operating cash flow, which eventually portrays the cash inflow or outflow from operating activities is very important for the organization, since it should the net cash generated/lost from the firm’s operations. From the differences noted previously it is important that a company not only makes profit but also generates sufficient cash from its operations to be able to meet its financial obligations (Weetman P. 2003, p 185-186). The operating cash flow should be considered as the lifeblood of the firm. Without cash from the operating activities the firm cannot operate for long. It is therefore important that a consistent net cash inflow from operating activities is shown in the financial statements. 3) The sources of cash flow that can be replaceable by new growth are long-term debts that mature and are taken back to finance new growth prospects. Fixed assets classified under investing activities can also be renewed once they finish their possible economic benefits by purchasing similar or better ones. Redeemable share capital, both ordinary and preference can also be renewed by another issue of such finance instruments (Lewis R. et al 1996, p 321). 4) The first basic solution of improving cash flow in view of the cash issue outlined is by focusing on sales and inventory management. By increasing the inventory turnover and diminishing the money tied up in stock by reducing stock levels can be useful remedies in order to free up some cash and enhance the liquidity of the James Spencer Corporation. Cash sales can also be boosted through the introduction of cash discounts. It is also pertinent that present debtors are properly chased by the credit control department to ensure that cash is collected on time (Bernabucci B.2005). Financial managers can also alleviate cash by reducing the debtors collection period through effective credit control policies and procedures put in practice and increase the creditors collection period from the present and potential suppliers. The factoring services provided by factor companies can be another viable solution to enhance cash flow from debtors. Factoring basically comprises the forwarding of a debt to a factor company at a reduced rate than the face value of such debt in exchange of a cash receipt of that account receivable (Ccassociates). For example a debtor of $10,000 of Company A is transferred to a factor company at 85%. Company A will receive $8,500 from such account receivable and then it is the responsibility of the factor company to collect the $10,000 from the trade debtor. James Spencer Corporation can also cushion its cash by either opting for an overdraft facility or increasing the present overdraft. This will act as a buffer against any unforeseen events that may weaken the cash flow of the firm. Even though bank overdraft is payable on demand by the bank, such debt medium is extremely flexible. This is due to the fact that the company can utilize how much of the debt it seems fit (Washington State University). For example if the overdraft facility is of $50,000, the company may take only $20,000 of such overdraft. References: Association of Accounting Technician (2007). Professional Ethics. Berkshire: Kaplan Publishing. Bernabucci B. (2005). Improving you Cash Flow Problems, Entrepreneur. com (on line). Available from: http://www. entrepreneur. com/money/moneymanagement/financialanalysis/article79084. html (Accessed 15th November 2007). Ccassociates. The Factoring Solution (on line). Available from: http://www. ccassociates. com/factoring_solution_accounts_receivable_factoring_explained. html (Accessed 15th November 2007). Foster M. J. ; Johnson L. T. (2001). Why does the FASB have a Conceptual Framework? Financial Accounting Standards Board (on line). Available from: http://www. fasb. org/articlesreports/conceptual_framework_uti_aug_2001. pdf (Accessed 16th November 2007) IAS 17 (2000). Leases. London: International Accounting Standards Committee. International Accounting Standards (2000). Framework for the Preparation and Presentation of Financial Statements. London: International Accounting Standards Committee. Lewis R. ; Pendrill D. (1996). Advanced Financial Accounting. Fifth Edition. London: Pitman Publishing. Washington State University. Short Term Sources of Finance (on line). Available from: http://cbdd. wsu. edu/kewlcontent/cdoutput/TOM505/page36. htm (Accessed 15th November 2007). Weetman P. (2003). Financial and Management Accounting. Third Edition. Essex: Pearson Education Limited.

lab on solutions :: essays research papers

I Introduction A. Purpose: The purpose of this experiment was to determine if the temperature of water effects the rate at which salt dissolves. B. Hypothesis: If the temperature of the water increases then the rate at which the salt dissolves will increase.   Ã‚  Ã‚  Ã‚  Ã‚  C. Science Concepts: Solution- one substance dissolved in another   Ã‚  Ã‚  Ã‚  Ã‚  Solute- the substance that gets dissolved   Ã‚  Ã‚  Ã‚  Ã‚  Solvent- the substance that the solute gets dissolved in Characteristic property- a property that is unique to a substance, does not change depending on the amount of a substance, and can identify the substance Physical change- when a substance changes physically but is not chemically effected Solubility- the amount of a substance that can be dissolved in a given amount solvent at a given temperature In the experiment the solubility of salt was tested in different temperatures of water. The solute was the salt and the solvent was the water. The salt dissolved in the water to form a solution. When the salt dissolved a physical change took place. Solubility along with melting point, freezing point, and density is a characteristic property. II Procedure 1. massing cups and a triple beam balance were used to measure 0.5 grams of salt 2. 100 ml of cold water was measured and poured into a beaker using a graduated cylinder 3. the temperature of the water was measured and recorded on a data table 4. the salt was poured into the water and the stop watch was started 5. the water was stirred as the salt crystals dissolved 6. the number of seconds it took for the salt to dissolve was measured and recorded on a data table 7. the experiment was repeated using room temperature and warm water  Ã‚  Ã‚  Ã‚  Ã‚   8. each group did one trial III Results/Conclusions A. Experimental Data: The results of the experiment indicate that the warmer the solvent was the faster the solute dissolved. When the water was 9 °C it took 51.66 seconds to dissolve. When the water was 57 °C it took only 13.15 seconds to dissolve.   Ã‚  Ã‚  Ã‚  Ã‚  B. Graphs and Tables: see attached C. Evaluate Prediction/Hypothesis: The results of the experiment support the hypothesis. The hypothesis stated that the slat would dissolve faster if the water was heated. The salt in the warmer water dissolved about four times faster than the salt in the cold water. IV Extension and Summery A. Extension: Some causes of experimental error may have been how fast the stirrer was stirring. This could have been fixed by having the same person stirring each time.

Behavioral Economics Essay

Introduction Behavioral Economics is an extremely important field of psychology; it seeks to expand the current tools that researchers use in economics and finance to introduce new models of human behavior that are adequately founded in psychological research. The Behavior Economics is crucial in business decision making process. The knowledge in Business and Financial Literacy is very important for their direct application to Business and Consulting Psychology. Understanding Financial Management which includes: profit & loss, cash flow, balance sheets, ratios, ROI, working capital, budgeting, financial planning, and corporate finance; and Business Management that includes: business strategy, strategic market management, micro-economic analysis, sustainable competitive advantage, strategic positioning, diversification, acquisitions, mergers, and technology management, will allow the consultant to help businesses increase their profits and improve their company’s culture. Business Management and Strategy Business Strategy is a management plan of action that an organization put in place in order to achieve a particular goal or a set of goals and objectives, this strategy can help the organization differentiate itself from its competitors. In order for a company to differentiate itself from their competitors, they need to successfully implement a strategy that will determine the market that the business will compete, the investment needed, the strategies required to compete in that specific market and the strategic resources or competencies that underline the strategy by providing a important sustainable competitive advantage (SCA) (Aaker, 2001). Budgeting and Financial Planning There are many vital managerial tools that assist in managing a successful business. Budgeting is the most common and widely used tool for planning and control; it is essentially a guideline that focuses on spending, it can breaks down all the business’ expenses in different categories, per example, utilities, payroll, taxes, materials, equipment, etc, also all the income that the business expect to receive in a certain period of time, this period of time is usually yearly, monthly or sometimes weekly. Once the manager has all the estimated income and expenses for that period of time, the budget will start to take shape. The budget goal is to subtract all the expected expenses from the expected income for the same period and still have a positive cash balance. A budget should not be a rigid and fixed tool from which you may never deviate (Wood, 2012). The Financial Planning focuses on allocating resources efficiently, specifically achieving long range goals. In summary, while the budget focuses on the daily functioning of the organization, the future depends greatly on the financial planning which in turn relies on budgeting in order to be effective. Corporate Finance The Corporate Finance addresses how organizations face their financial obligation, to intelligently invest their resources, achieve the correct combination of financing to fund their investments and return a profit to the investors; hence achieving value maximization. When a company invests in a project or multiple projects, this project will generate expenses and will create revenue for the company, but what is a project? Project is any activity that generates a series of cash flows for the organization. The company uses the revenue in excess of expenses to fund new projects, improve existing projects or pay its investors (Spiegel, 2000). Per example, applying a low-cost strategy, businesses can remove all frills and extras from its products and services (Aaker, 2001), making the organization more competitive and profitable. Financial ratios The Financial Ratios are practical indicators of a company’s financial and performance situation. The most important indicator of a business performance is profits. Profits provide the basis for the internally or externally generated capital that the organization needs to follow its growth strategies, to replace out of dated plants and equipments, and to absorb market risk (Aaker, 2001). But how can we measure the profitability of an organization? The most basic and important tool to measure profitability is the Return on Assets, which is calculated by dividing the organization’s profits by the assets involved (Aaker, 2001). The ROI measures how much profit the organization can produce with the capital that is available to them (Gitman, 2009). The company’s goal is to increase the ROI, because higher the ROI, the better. That’s why the ROA is so important for managers, investors and other business that may sell to this company. Strategic Marketing The Strategic Marketing includes creating a marketing plan that describes in detail the marketing mix, segmentation, and branding decisions. Branding is not just to increase sales in one product, but to any product that is associated with that brand. That’s why engagement matters; it pulls customers back into the business and at the end of the day leads to repeat sales (Goodman, 2012). There are many different ways to use branding to support the organizations growth strategy, but for each specific growth strategy that are different approaches that can be used in order to achieve success (Aaker, 2001). Sustainable Branding will also increase customer loyalty where customers will recognize the quality of the product or service every time that they see the brand (Aaker, 2001). Downsizing, Mergers & Acquisitions Mergers & Acquisitions essentially have the same features where the end result is one company where two existed. As stated by Shook & Roth (2010), during a merger and acquisition process, the organization will try to eliminate any overlapping positions and this process can cause downsize, which is the process of restructuring a organization in a way that brings reduction of a part of the company’s employees. If the M&A is successful, the new company will be more cost effective, efficient and mostly important, profitable (Holden, 2010). Mergers and acquisitions can also reduce significantly the competition and the overhead for both companies (Holden, 2010). Consultants can be key facilitators of a smooth transition (during a M&A) by ensuring that there is sufficient understanding and ‘buy-in’ at the leadership level about the costs of not addressing the culture issue early in the M&A process. There is plenty of empirical evidence suggesting the failure rate of M&A’s due to issues with the unsuccessful meshing of a newly merged corporate culture. During an M&A, cultural change often represents the ‘soft side’ of the transaction. Everybody agrees about its importance but it seems too frequently to take a rear seat in the stated price tag synergies to be accomplished, as well as, how the new administrative track that needs to be quickly put in practice. Conclusion The main goal of a business consultant is to provide a professional or/and expert advice, but in order to do it, it’s vital that consultants understand the need to become an expert on their client’s business and industry; it’s also very important that consultants understand the need to communicate in their clients’ language. Also, in order to be effective, the consultant should be able to use motivation to trigger the organization members to change their behavior in order to achieve the organization goals (Fernandez-Huerga, 2008). As a consultant, my goal is to support the company’s administration to resolve management, manufacturing, marketing, or other issues by providing: * Focus and direction, * Expert analytical skills, * Objectivity, and * Knowledge and experience obtained from earlier assignments Also as a professional I will help clients to define a project’s goal and capacity, and together with administration prepare a comprehensive proposal to document how the project will be implemented in order to achieve the desired objectives and steps along the way. Also I will make sure that the proposed changes are approved by the client before put in practice. Another very important issue is to maintain confidentiality during and after the assignment. My ultimate goal as a consultant will be to develop a concept of a sustainable competitive advantage (SCA) and to neutralize the SCAs of competitors (Aaker, 2001). Using the Game Strategy, which is a study of strategic decision making, the consultant will be able to develop important insights concerning the strategy and how it should be addressed providing a rational choices for businesses dilemmas (Wood, 2012). References Aaker, D. (2001). Developing business strategies (6th Ed.). New York, NY: John Wiley and Sons, Inc. Berman, K. & Knight, J. (2008). Financial Intelligence For HR Professionals. Boston, MA: Harvard Business Press. Fernandez-Huerga, E. (Sep2008). The economic behavior of human beings: The institutional/post-Keynesian model. Journal of Economic Issues (Association for Evolutionary Economics, 42 (3), 709-726. Gitman, L. J. (2009). Principles of managerial finance. (12 ed.). Boston, MA: Addison-Wesley. Goodman, G. F. (2012). Engagement marketing: How small business wins in a socially connected world. Hoboken, NJ: John Wiley & Sons. Holden , P. (2010). Economies of scale: a quick explanation [Video file]. Retrieved from YouTube website: http://www.youtube.com/watch?v=AZshS761WsE Marks, M. (2003). Surviving MADness. HR Magazine, 48(6), 86. Marks, M., & Mirvis, P. H. (2012). Applying OD to Make Mergers and Acquisitions Work. OD Practitioner, 44(3), 5-12. Shook, L., & Roth, G. (2010). Downsiz ings, mergers, and acquisition: Perspectives of human resources development practitioners. Journal of European Industrial Training 32(2), 135-153. Spiegel, M. (2000). Principles of corporate finance. Unpublished raw data, Yale School of Management, Retrieved from http://som.yale.edu/~spiegel/intro/sampread.pdf Teamtechnology.co.uk. (n.d.). Retrieved from http://www.teamtechnology.co.uk/changemanagement.html Wickramasignhe, V. & Karunaratne, C. (Mar2009). People management in mergers and acquisitions in Sri Lanka: employee perception. Journal of Human Resource Management, 20 (3), 694-715. Wood, N. (2012). Behavioral Economics. [PowerPoint slides]. Retrieved from http://www.nancywood.org/Business/Behavior/Behavioral.pptx

Outline Of A Shirt Sleeve - 1192 Words

All buttons must be fastened on women’s short-sleeved woven (button-front) and  ¾-sleeved woven shirts. Women’s white long-sleeved shirt may have top button unfastened. †¢ Men must wear solid white t-shirts (no printing or graphics) under all shirts. T-shirts are optional for women. All t-shirts must be in good condition (with no holes, fraying, discoloration, etc.). T-shirt sleeve length should not extend below bottom edge of Ember’s shirt sleeve. †¢ Mock turtlenecks, from the TeamStyle collection, may only be worn under polo shirts, woven (button-front) shirts or sweater vests. †¢ Pants must fit properly and must be hemmed to fall at midpoint of heel. Cuffed and/or pegged pants are not acceptable. †¢ Females must wear solid black socks, black hose or flesh-toned hose. Males must wear solid black socks. †¢ Ember’s neckties must be worn with all long-sleeved men’s shirts. Ties should be properly knotted and securely fastened and fall to the midpoint of the belt buckle. Ties must not be worn with short-sleeved, button-front shirts or with women’s shirts. †¢ Employee caps/visors may be worn at the Operator’s discretion and/or in order to comply with local health department requirements. Caps/Visors must be clean and have no visible stains or discoloration. Caps/visors should be worn on the head with the bill facing directly forward and above the eyebrows so that eyes are clearly visible under brim of cap. Jewelry †¢ Jewelry (including medical alert jewelry) must be modest in size toShow MoreRelatedPersonal Affect Of New Tattoo Policy1391 Words   |  6 Pagesstill some Tattoo’s that should not be allowed in the military whether it be a sexist, racial or extremist tattoo, that could offend or start rivalry’s within today’s army if they were allowed. The New revised regulations in AR 670-1 and DA PAM 670-1 outline all of the new regulations for several things, including tattoos. 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