Validity of the accounting implications, Financial Management

Assignment Help:

Question:

In each case below and having regard to your knowledge of Accounting Concepts, comment on and assess the validity of the accounting implications/practices to be adopted by these businesses:-

(i) Mr. Goldman is a very skilled and artistic Jeweller who has won various exhibition prizes. He considers himself to be the most important asset that his workshop could possess. Consequently, he has instructed his accountant to include his "knowledge and skill" as an Asset in the Balance Sheet of the business.

(ii) The Debtors figure in the books of "Electric Appliances Ltd." includes an amount of Rs 5,000 owed by one Mr. Jackson since some three years now. Various appeals have been made to him to settle the debt but to no avail. A final reminder was sent to him by post but the letter was returned to sender with the mention "Gone Away".

(iii) While preparing the Final Accounts of "Maxi Stone Crusher Ltd." for the year ended 30th June 2005, you read in the Newspapers that the License of this Stone Crushing Company will not be renewed after its present expiry date i.e. 30th September 2005 because the place where it is located has been declared a "Residential Zone".

B. Describe what do you understand by:

(i) A Revenue Centre; and
(ii) A Cost Centre;
(iii) An Investment Centre. and give an example in each case.


Related Discussions:- Validity of the accounting implications

Valuation methods, Valuation Methods: 2 - Year Method Perpetual ...

Valuation Methods: 2 - Year Method Perpetual Growth Method Constant Growth Method Zero Growth Method Growth Phases Valuation Model:  'Constant Growth Met

Specifications for contracts, S pecifications Following are the variou...

S pecifications Following are the various specifications that we need to apply while creating contracts. If the goods to be procured are covered under Bureau of Indian

Working capital as a percentage of net sales, Q. Working Capital as a Perce...

Q. Working Capital as a Percentage of Net Sales? This approach to estimate the working capital requirement is based on the fact that the working capital for any firm is directl

Discuss the process of maximise profits, Discuss the process of  Maximise ...

Discuss the process of  Maximise Profits Let's first look at profit maximisation.  Profit (also known as net income or earnings) canbe defined as the amount a business earns af

Estimate the companys wacc, Assemble all other inputs/assumptions based on ...

Assemble all other inputs/assumptions based on the past data. Use your best judgment to have the most reasonable estimates. Tasks 1. Prepare an Excel spreadsheet containi

Types of efficiency-efficient market hypothesis , Types of Efficiency   ...

Types of Efficiency    Efficient market theory can be described in three ways: 1) Allocative Efficiency: A market is allocatively proficient when it directs savings tow

What is the basic goal of a business, What is the basic goal of a business?...

What is the basic goal of a business? The primary financial goal of the business organizations is to maximize the wealth of the firm's owners.  In turn Wealth refers to value.

Perfectly competitive market, What level of profits can you earn in a perfe...

What level of profits can you earn in a perfectly competitive market and what drives markets towards perfect competition over the long run?

Modigliani-miller irrelevancy theorem for capital structure, QUESTION i...

QUESTION i) Discuss the Modigliani-Miller irrelevancy theorem for corporate capital structure. What assumptions underline the theorem? ii) What are the implications when the

Passive management, In the efficient markets, whether it is sec...

In the efficient markets, whether it is security, equity or fixed-income markets it is believed that the investors use some type of passive strategy in

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