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for Business Economics and Finance - Assignment Example
Author : jaylan94
Finance & Accounting
Pages 4 (1004 words)
Finance and Accounting 1. What is the main purpose of accounting? The main purpose of accounting is “to provide information that can be used in making economic decisions” (Stice et al. 2004, p. 8). Its role is to service the needs of the organization by providing quantitative information (Stice et al…
4). There are of course several accounting specialties and each of them is important in their own characteristics (Bonner et al. 2006). 2. Case of Halfords A. Identify the main accounting books that can be used by Halfords to records transactions. Halfords is a company that buys and sells bicycles. The main financial statements that can be used by organizations to record is financial condition, especially business organizations are the balance sheet, income statement, and the statement of cash flows (Stice et al. 2004). The balance sheet “reports, as of a certain point in time, the resources of a company (the assets), the obligations (the liabilities), and the net differences between its assets and liabilities, which represents the equity of its owners” (Stice et al. 2004, p. 10). The balance sheet addresses two fundaments information: what it owns and what it owes (Stice et al. 2004). The income statement “reports, for a certain interval, the net assets generated through business operations (revenues), the net assets consumed (expenses) and the difference, which is called net income” (Stice et al. 2004, p. 10). ...