Instant Assignment Help - Case Study On Financial Accounting

1. Individual Case Study on Financial Accounting TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

2. Table of Contents INTRODUCTION......................................................................................................................1 TASK 1 Main financial findings................................................................................................1 AC 1.1 Summary of the first 6 months business operations..................................................1 AC 1.2 Financial accounting statements................................................................................1 TASK 2.......................................................................................................................................2 AC 2.1 Initial analysis in the context of three financial statements.......................................2 AC 2.2 Investigation to increase efficiency...........................................................................3 Conclusion..................................................................................................................................3 References..................................................................................................................................4 Appendix....................................................................................................................................5 TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

3. INTRODUCTION Financial accounting is a process of recording all the business operating and financial transactions in a correct manner. Fashion cloth business manufacture clothes products and sell directly to the consumers through its shops and online websites. Present project report aims at determining the performance of Fashion clothing to assist a group of friends who invested their own funds in the organization. TASK 1 MAINFINANCIALFINDINGS AC 1.1 Summary of the first 6 months business operations The operations of the Fashion cloth business include all the trading functions such as purchase and sales activities. As per the given business scenario, the estimated business incomes and expenditures are given for the first six months. Fashion cloths business is generating revenues through selling the products in the market. In the first six months, company's estimated revenue is 1,350,000. However, expenditure includes material, labour and other business expenses for selling the cloths product at the market place. Business forecasted material, labour and other expenses are 390,000, 480,000 and 345,000. On the basis of expected cash flow, profit and loss and balance sheet. It is seen that the business unit is expected to generate high amount of profit. The organization is going to generate sufficient amount of net profit in the first six months of operations. Moreover, the cash flow generated from business unit is expected to increase on continuous basis. It can be therefore said that the business planned is highly profitable in nature. The organization is not taking much of the time to reach breakeven point. On the basis of analysis of financial forecasts for the first six months of business operations, it can be claimed that the new venture is highly profitable in nature. This in turn encourages investment into the venture for fashion cloth planned herewith. AC 1.2 Financial accounting statements The business unit needs to prepare different form of financial statements as stated underneath. TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

4. Statement of financial position: Balance sheet summarizes all the assets and liabilities of Fashion cloths. It helps to determine financial position of the business hence, also known as statement of financial position. It is through statement of financial position that the net worth of business unit is determined. Statement of cash flows: Cash flow statement represents cash inflows and cash outflows for a given period. It helps to determine changes in business cash balance between two different accounting periods (Hoskin, Fizzell and Cherry, 2014). The organization can estimate inflow and outflow of cash through its cash flow statement. Income statement: It combines Fashion clothes expenditure and revenues of its operating activities. Determining operational results in terms of gross profit and net profit as well as net losses are the main purpose of the statement. The income statement helps in estimating profit generated on part of business unit. THIS IS A SAMPLE DOCUMENT BUY COMPLETE ASSIGNMENT CONTACT: TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

5. TASK 2 AC 2.1 Initial analysis in the context of three financial statements In order to judge the variability of new venture, the fashion clothing forecasted statements for six months have been prepared. It is through estimations of profit and cash flows for upcoming year that the feasibility of the business unit can be judged. An in-depth evaluation of three forecasted financial statements is presented underneath. Statement of financial position: The statement of financial position is prepared as on July 2015 and December 2015. It is seen that the net value of assets has been increased drastically during the period of six months. The business unit has been initiated with the amount of 2, 00,000. The value of business unit as determined by its assets has been increased to 11, 70,000 in the period of six months. This in turn indicates the significant growth that is expected to achieve buy the newly established venture in period of six months. However, it is expected that the organization is going to avail sufficient level of credit on its purchases (Weil, 2012). The venture is also expected to allow credit to its clients on sale. It can be therefore said that the venture is expected to improve its financial position significantly in the period of six months. Income statement: The forecasted income statement for six months has been prepared so as to ascertain the expected level of income. It is seen that the organization is going to generate sufficient amount of income during the period of six months (Parsian and Shams Koloukhi, 2014). The high amount of revenue is expected to be earned on part of the business unit. The venture has expected to earn revenue of 1350000. Moreover, the net profit margin of 10% is forecasted to be earned for six months of operations. This in turn indicates sufficient level of profitability to be earned on part of business unit. Cash flow statement: The statement of cash flow indicates the amount of cash generated or used by business unit (Lchigo, 2011). It is forecasted that the business unit is expected to generate cash flow of 680000 in period of six months. It can be therefore said that the venture planned is capable of generating adequate amount of funds in liquid form. TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

6. AC 2.2 Investigation to increase efficiency It is forecasted that the newly established venture is going to generate sufficient amount of cash flow and profits. The organization is expected to earn high amount of revenue during the period of six months. However, the business unit is allowing high credit to its customers. The promoters should adopt risk-averse nature during the period of establishment. The business unit should lower down its credit facility. Moreover, the organization should try to avail lower discounting facility. This in turn results in reducing operating cycle. Moreover, the business unit is going to conduct operations in a highly efficient manner. It is with lower operating cycle that the business unit is going to generate fast amount of cash within the business unit. Moreover, risk will be reduced on part of the organization. TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

7. CONCLUSION The report proposed herewith emphasizes on evaluating feasibility of Fashion clothing. It is seen that the venture of Fashion clothing is highly viable in nature. The business unit is expected to generate adequate amount of profits and revenue. However, the promoters should adopt risk averse in nature so as to increase efficiency. THIS IS A SAMPLE DOCUMENT BUY COMPLETE ASSIGNMENT CONTACT: TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

8. REFERENCES Books and journals Hoskin, R. E., Fizzell, M. R. and Cherry, D. C., 2014. Financial accounting: a user perspective. Wiley Global Education. Parsian, H. and Shams Koloukhi, A., 2014. A study on the effect of free cash flow and profitability current ratio on dividend payout ratio: Evidence from Tehran Stock Exchange. Management Science Letters. 4. pp. 63-70. Weil, L.R., 2012. Financial Accounting. 14th edition. Cengage Learning. Online Lchigo, H. D., 2011. The different between the formats of financial statements (income statement and balance sheet) for different types of business such as sole proprietorship, partnership and limited company. [Online]. Available through < http://www.studymode.com/essays/The-Different-Between-The-Formats-Of- 729498.html> [Accessed 25th January 2016]. TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

9. APPENDIX Statement of financial position as on July 2015 Particulars Capital & Liabilities Equity capital Liabilities Total liabilities & equity Assets Non-current assets (Fixed assets) Bank Total assets Amount 200000 0 200000 150000 50000 200000 Income statement for the six months ending December 2015 Particulars Sales Cost of material Labour cost Gross profit Marketing cost and depreciation Net profit Amount 1350000 390000 480000 480000 345000 135000 Aug ust 1200 00 1200 00 1000 00 Septem ber Octob er 21000 0 21000 0 Novem ber Decem ber Particulars July 1500 00 1500 00 1200 00 Sales receipts 150000 260000 285000 Cash inflow 150000 260000 285000 Payment for material, labour and other expenses Tax bill Additional non-current assets 60000 60000 60000 60000 20000 30000 1200 00 3000 0 1000 00 2000 0 Cash outflow 60000 60000 15000 0 60000 110000 Cash flow Add: Depreciation 90000 200000 175000 15000 3000 0 5000 0 3000 2000 0 8000 0 2000 15000 0 19000 0 15000 Net cash flow 90000 200000 190000 Opening balance Net cash flow 100000 90000 340000 200000 540000 190000 TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

10. 0 0 0 8000 0 1000 00 34000 0 Closing balance 190000 540000 730000 Particulars Sales Cash sales Credit sales (Debtors) Material purchases Labour cost Marketing cost and depreciation Total expenditure Payment made Total trade and other creditors Amount 1350000 1175000 175000 520000 480000 345000 1345000 510000 835000 Particulars Opening stock Add purchases Less: Materials utilized Closing stock Amount 0 520000 390000 130000 Statement of financial position as on December 2015 Particulars Capital & Liabilities Equity capital Add: Net profit Liabilities Creditors Total liabilities Total liabilities & equity Assets Non-current assets (Fixed assets) Less: Depreciation Bank Debtors Inventory Total assets Amount Amount 200000 135000 0 835000 335000 835000 1170000 150000 15000 135000 730000 175000 130000 1170000 Cash flow statement Particulars Amount Amount TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK

11. Cash flow from operating activities Net profit Adjustments for: Depreciation Increase in debtors Increase in creditors Increase in inventory Cash generated from operating activities Cash flow from investing activities Net cash used in investing activities Cash flow from financing activities Net cash generated from financing activities Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period 135000 15000 -175000 835000 -130000 680000 0 0 0 0 680000 50000 730000 THIS IS A SAMPLE DOCUMENT BUY COMPLETE ASSIGNMENT CONTACT: TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com TOLL-FREE NO: +44 2038681671 EMAIL: help@instantassignmenthelp.com WHATSAPP NO: +44 7999903324 WEBSITE: https://www.instantassignmenthelp.com ASSIGNMENT WRITING SERVICE UK