Accounting and Financial Statement

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Accounting and financial statement

• Business going concern- dobry interes = IT WILL CONTINUE INTO THE FUTURE Current market value of its fixed assets is irrelevant, they’re not for sale. Fixed assets-środki trwałe.

• NET BOOK VALUE->>Historical cost accounting = assets at original purchase price –accumulated depreciation charges. WARTOŚĆ KSIĘGOWA NETTO historyczna kalkulacja kosztów = aktywa w oryginalnej cenie zakupu-zgromadzone odpisy amortyzacyjne

• In Times of inflation historical cost accounting:
Understates the value of appreciating assets such: lands BUT Overstates profits as it doesn’t record the replacement cost of plant or stock.
Pomniejsza wartość doceniając aktywa tj: Ziemia ALE
Zawyża zyski, ponieważ nie odnotowują  kosztów odtworzenia maszyn lub akcji.

3 financial stetements In annual raport of companies:

• The profit and loss account(income statement) shows revenue and expenditure.
Give figures for total sales or turnover and costs and overheads.
Profits goes to: the government in taxation / shareholders as a diviedend/ part is retained by company. • The balance sheet shows: a company financial situation on a particular date, the last day of financial year. Lists: - assets – liabilities – shareholders funds( kapitały, fundusze)

Assets= debtors( należności) will be paid
Liabilities= payable accounts(wypłacalne konta) have to be paid

• The source and application of funds statement , the statement of changes in financial position= Shows the flow of cash in and out of the business between balance sheet dates.

➢ Dobule-entry bookkeeping- all transaction are entered as a credit in one account and as a debt in another.


Include: Share capital – money received from the issue of shares...
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