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Business Accounting for Managers

 As per Farrah, The reflection is our thoughts and analysis of what one has read and experienced. I am presenting this reflection paper is to present my own opinions on my learnings, knowledge, and experiences which I have acquired in these weeks. Throughout the week 2 –5, I have progressively built up an accounting glossary and accounting concepts which includes accounting principles of accrual concept, consistency principles, conservatism principles, going concern principle, and materiality principle. I have gone in-depth analysis of these principles some of them are-

  • Consistency Principle – Once one had decided which method he has to use in his business he needs to stick at that method throughout the accounting period.
  • Going Concern Principle- This principle refers that the business will continue to exist for the foreseeable future and this allows to defer the prepaid expenditures to future accounting periods.
  • Materiality Principle –this principle states that the accountant must be sure to include and report all the material items in the financial statements.
  • Accrual Concept – It prescribes that the revenues are recorded when they are earned and not when they are received and recording of expenses when they incurred not when they are paid (Azim and Ahmed 2015).

According to Warsono, there are some important definition and accounting terms which are more significant in the day to day business operations. For example: double-entry accounting It is a standard accounting method that refers to recording every transaction in two accounts where one account is debited and another is credited; accounting equations- it is the foundation of Double-entry accounting. It shows assets off-balance sheet is always equal to the liabilities of the balance sheet [ Assets= Liabilities]; special journals – these are used to record the most frequently occurring transactions. Sales journals, purchases journals, and Cash payments journals and Cash receipts journals are included in the special journals; inventory costing methods- It is important as the inventory is to be recorded in business has to follow the appropriate method which is Last in first out (LIFO), First-in first-out (FIFO), and the average cost of the method and this directly affects its financial statements.

Warsono further explains that there are certain formulae that everyone should know if one is dealing in business transactions.

  • The accounting equation is Assets = Liability + Owners equity

This means all the assets of the company should be always equal to all the liabilities.

  • Net income equation = Revenue – Expenses

This means all revenue which the business is earning reduces all the expenses of the business remains the net income of the business which the actually business earns.

  • Breakeven point - Fixed cost / Contribution per unit

 It is the point where the total revenue of the business reaches the total cost and the business is not making a profit and loss.

  • Profit margin ratio – Sales – All expenses /Revenues

It is a ratio that tells the company is handling its financials overall.

  • Retained earnings equation – current year net earnings + previous year retained earnings – dividend paid to shareholders.

These important terms and formulae must be recognized in every aspect of accounting. I have developed various kinds of skills and knowledge while going through all these concepts and knowledge. I got to know that what accounts is, what kind of principles which one has to follow in the business transactions, different kinds of concepts and definition which not only improves my knowledge but increases the skills in me about the same that how to deal with the clients regarding the given concepts and besides that, there is an enhancement in my oral and written communication and there is an advantage for me that because of this there is a rise in my analytical and problem-solving skills and through this I can able to decide within an appropriate time. Accounting helps in every field of work, one can able to plan, organize, and either prioritize his works more efficiently.

I work at ABC Pvt. Ltd as an accountant, through the knowledge and skills I have gained in these weeks, is helping me in work through which I got to know the application of the same and gaining experience. I am learning accounting in this unit in these weeks and I am learning as I am working as an accountant in which it helps me a lot. The accounts are used in every business transaction in the world so everyone should know the basic principles and concepts of accounts and I am using my learning in the application of the same in my work area through which I got to improve myself. The learning which I have got through all these will eventually help me in my practical approach of accounting as if my basics are not strong I cannot do the practical approach. So through these learnings, I got to know a lot and there is so much learning there which not only improves my skills but my confidence also towards practicality. As applying the accounting principles to real life it is clear that the entity has to follow in real also without that the financials will be correctly stated.

The learning experiences will help me a lot in self-evaluation of mine and through the knowledge and skills I have gained it helps to improve myself in the quizzes which I used to give and improved my confidence and helps me in the self-test questions which I used to do it myself and the feedback provided by the teachers will help me in analyzing myself and helps me to take corrective actions in the future which will help me in improving my capability only. From the feedback I have received, it will help me in my future practices. My earlier knowledge of accounting will helps in understand the later concepts of my subject easily. Self-evaluation of mine will provide me the opportunity to approach assessments like quizzes, tests will not only improve my knowledge base but helps me in enhancing my skills up-gradation of my practical approach, improves my confidence and feedbacks helps me in future practices.

Through the self-evaluation, through quizzes, I got to learn more and more which upgrade my skills overall and improves my practice approach and oral and written communication with the clients. The priorities as a learner of mine are to always pay attention in the class so that what the concepts are going through there it will not goanna miss anymore and my approach was to give the teacher my best performance through my attentiveness and my knowledge. If I did not know any topics it was my weakness but I can build the same to my strengths through my self-evaluation and tests which are conducted. As I talk about the challenges as a learner in accounting I would say that financial management, the cost calculation systems, the inventory processes, and majorly the cost accounting issues it is because these are the topics which one not gets easily while thorough reading it must need in-depth study.

The different skills which I needed in the learning of the accounting are mostly the intellectual skills, the functional and technical skills, personal skills and interpersonal communication skills are the most required as one should know how to contact with the clients as an accountant and there is needed organizational and business management skills. I can use the feedback from the assessment task and quizzes which I gave in the classes as improving myself and be more attentive and focused on that particular topic and the one needs to know their drawback so that through the feedbacks they can improve themselves. Different parts of my learning are interconnected as through the knowledge which I have given from the classes are theoretical concepts which I have applied through my skills in the practice approach of the world so it seems everything is interconnected to each other.

This learning will help me in improving my drawbacks which I possessed earlier and the things which I have not cleared or not gained properly the concepts through earlier learning it helps in improving my concepts about accounting and removing the drawbacks through my knowledge of this learning. Through this learning, I have overcome important concepts which don’t know earlier. I can achieve my goals of accounting by having belief and faith in the process that I can understand that better and makes my thoughts turns into reality, I visualize what I want in my life or where I want to be, What emotional, personal, financial, physical properties and social need to be addressed, I write my goals because the writing of the goals one can become the creator, Knowing the purpose of the life. The Identification of the purpose of your goal will helps you instantly recognize that why you want that particular goal. Anyone does not know how on will reach his/her goals but when he/she makes a daily practice of focus, it becomes easier to reach the goals. Being clear about what one wants. Someone having goals without a plan is like he is trying to complete a complex project without a project plan. One should be accountable It is important to have someone besides yourself who will provide valuable feedback to us like a mentor or a senior. Telling your friends and family about your goals may give you the accountability your need. I can improve my learning process by applying all the knowledge, skills of mine through a practical approach, and through the skills, I can give the best of mine in the practical exposure of life. The ideas which I was having earlier before these weeks is changed through these classes as I have gained a lot through these weeks which I can apply in my job work and through these, I can learn a lot of concepts which improves my knowledge, skills and helps me in my future work through the feedback which I have got.

Through the proper power of planning, I am getting the direction and the structure that I want. Through patience, I got to learn a lot through these weeks and which I will apply to my future work and I learn that criticism is good sometimes as it gets to know the drawbacks of yours and through that one can improve ourselves as to a better. So through this reflection paper, I got to learn a lot of skills, knowledge, and experiences through these weeks.

References for Perspective of Accounting Principles

Azim. Md. and Ahmed. H. 2015. 'Perspective of Accounting' principles, rules, ethics, and culture. International Journal of Economics, Commerce, and Management. 3(1), pp.1-10.

Farrah. M. 2012. ‘Reflecting Journal Writing as an Effective Technique in the Writing Process’. An –Najah University. J. Res (Humanities). 26(4), pp. 998-1025.

Warsono. S. 2017. The Accounting Equation and Revisiting the Theory of Double-Entry Bookkeeping. “Accounting and Mathematics: Revisiting the Theory of Double-Entry". [Online].Available at: https://www.researchgate.net/publication/320912369_The_Accounting_Equation_and_Revisiting_the_Theory_of_Double-Entry_Bookkeeping [Accessed on August 10, 2020].

Remember, at the center of any academic work, lies clarity and evidence. Should you need further assistance, do look up to our Accounting and Finance Assignment Help

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