Comparative Analysis: Economic and Accounting Fundamentals in Correlation with Commercial Success

Only available on StudyMode
  • Download(s) : 52
  • Published : March 18, 2013
Open Document
Text Preview
Comparative Analysis of Economic and Accounting Fundamentals in Correlation with Commercial Success

For a true commercial juggernaut to exist, it is imperative that these fully developed economic theories be utilized in association with unvarying accounting principles. Despite the innumerable amounts of arguments that may arise between a pure Accountant and a pure Economist on certain topics, the two fields of study are severely supplementary to one another. The reason I have researched the discussed topics in this paper is to prove the importance of understanding both the fundamentals of economics and accounting. Now-a-days, students who choose to focus on one particular practice are missing out on an entire realm of requirements to form a fully functional business. Those students who declare a Business major with the intention of becoming a successful business owner will need more than just ambition to drive them to their goal. It is crucial for any business owner to know every single aspect of accounting principles in order to operate their founded establishment. Likewise, that same business owner must also be familiar with microeconomic principles in order to resourcefully target their desired consumers.

It has been over a century now that citizens from a variety of countries have been flocking to the United States for the same exact motive: to better their livelihood through the economic benefits provided by the nation. In the past century, a majority of these peoples set foundations for themselves by gradually starting up their own personal businesses. Whether it be a small business or a large wholesaling company, the success of these personal endeavors solely depend on the organization of that business, combined with the appellation they exhibit to the public consumers. In modern days, those individuals who strive to accomplish their unique goal are faced with the same exact tasks: To ensure the satisfaction of their buyers’ desires. It is the proper motivation and organization of the business entity that renders it successful. The only way to ensure a consumer’s complete satisfaction is by maintaining an efficient business model; this model should consist of a variety of applications derived both from the fundamentals of Economics and Accounting. In the early 20th century, those business owners who set their foundations in the “land of opportunity” were only vaguely familiar with the concepts of economics, let alone accounting. During this neonatal period of American commerce, businesses were incorporating only a fraction of the ideologies expressed by Economics; the only accounting principles present was the calculation of losses and gains. There were no formal reports dictating each and every expense incurred by the business: everything was calculated based off how much money was spent, and how much money was made. It is not until the mid-1900s when corporations start to incorporate a majority of the essentials of economics and accounting to better their business model. Companies such as Coca-Cola and McDonald’s began targeting their consumers’ true emotions in combination with proper accounting organization in order to slowly begin expanding their magnitude. Examples such as these corporations prove that even small businesses today have a great deal of room to expand by stringently encompassing accounting principles, microeconomics, and macroeconomics into their business model.

Although the concept of economics has been utilized for numerous centuries, it is not until the past couple hundred years where theories of cause and effect for certain commercial situations have been exploited. “The term economics was originally coined by the Greek: the dictionary definition of the term translates into ‘the maintenance of a household.’ The ancient Greek determined that the success of their “household” seemed to rely on the intangible ideology of control tied...
tracking img