Accounting for Business Studies

Aneirin Owen

• Publisher: Routledge
• Year: 2007
• Print ISBN: 9780750658348
• eBook ISBN: 9781136431395
• Topic: Business
• Subtopic: Accounting
• Index: Business

Businesses are complex, and, as a result, teachers face a difficult task developing students' understanding of how they work, especially in the global context. Accounting for Business Studies helps teachers focus on modern commercial issues and integrates accounting into business and management studies. This book includes: * A business perspective rather than an accounting perspective * e-business, including case studies * Globalisation, including case studies * Business skills, like interpretation, analysis and communication * IT integrated into specific business situations * Includes models such as Porter's Five Forces, Supply Chain, Product Life Cycle

Chapter
1		Introducing accounting

This chapter establishes the main concepts and issues, which are fully explored later.

Objectives

• Understanding profit;
• Circuit of capital model;
• Types of assets & liabilities.

Introduction

Business context

Business is an exciting and fast changing environment. ‘Globalisation’ and e-business have created new opportunities and fresh challenges. Accounting concepts, definitions and frameworks need reformulating to make them more relevant and applicable to a high technology, global environment as well as traditional business sectors.

Activities

This chapter introduces the concepts of capital and profit using a worked example and a ‘circuit of capital’ model. When you have completed this chapter, attempt the two questions at the end, checking your answers against the solutions given. Once the relationship between capital and profit is understood, we progress to accounting terms and definitions (Chapter 2) which are then placed in an overall framework for understanding accountancy and finance (Chapter 3).

Businesses are run for profit; without it they do not survive. Profit is generated by selling a product or service for more than the total cost of making or buying it. The more a company sells, the more profit it should make. Measuring the exact amount of profit, however, is not easy. Measuring profit is the main purpose of accounting.

Just making a profit is not enough. Profit has to be sufficient to justify the capital invested in the business. Making a £100,000 profit seems, at first glance, a good result; however, if £10,000,000 (£10 million) o...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright
• Dedication
• Contents
• Preface
• 1. Introducing accounting
• 2. The Language of Accounting
• 3. The Accounting Framework
• 4. Year End Adjustments
• 5. Trading and Profit and Loss Account and Balance Sheet
• 6. Cash Flow Forecasting
• 7. Bad Debt, Discounts and Adjustments
• 8. Budgeting
• 9. Budget Interpretation
• 10. Accounting Ratios
• 11. Limited liability and the stock market
• 12. Financial Management
• 13. Breakeven and Margin of Safety
• 14. Costing
• 15. Activity-Based Costing
• 16. International Business
• 17. e-Business
• 18. Investment Appraisal
• 19. Accounting in the Business Environment
• Index