Principles for preparing financial statements - Free Essay Example

Sample details Pages: 4 Words: 1140 Downloads: 2 Date added: 2017/06/26 Category Finance Essay Type Narrative essay Did you like this example? The accountant keeps all the owners personal transactions different from the transactions of hisÂÂ  businessÂÂ  of sole proprietorship. ForÂÂ  legalÂÂ  purposes, a sole proprietorship and its owner are considered to be one entity, but in accounting they are two separate entities. Monetary Unit Assumption: Any Economic activity taking place is measured in U.S. Don’t waste time! Our writers will create an original "Principles for preparing financial statements" essay for you Create order dollars, and the ones which can be expressed in U.S. dollars are recorded. Because of this principle, an assumption is made that the purchasing power of the dollar has not changed over time. Hence, accountants do not take into account the effect of inflation on recorded amounts. For example, dollars from a 1952 transaction are shown with dollars from a 2008 transaction. Time Period Assumption: According to this principle it is possible to report the ongoing activities of a business in relatively short, distinct time intervals such as the five months ended June 31, 2009, or the 5 weeks ended June 1, 2009. The bigger the time interval, the less likely is the need for the accountant to estimate amounts relevant to that period. For example, the property tax bill is received on December 15 of each year. On the income statement for the year ended December 31, 2008, the amount is known; but for the income statement for the three months ended March 31, 2008, the amount was not kn own and an estimate had to be used. It isÂÂ  imperativeÂÂ  that the time interval be shown in the heading of each income statement, statement of stockholders equity, and statement of cash flows. Labeling one of theseÂÂ  financial statementsÂÂ  with December 31 is not good enough-the reader needs to know if the statement covers theÂÂ  one weekÂÂ  ending December 31, 2008 theÂÂ  monthÂÂ  ending December 31, 2008 the three monthsÂÂ  ending December 31, 2008 or theÂÂ  year endedÂÂ  December 31, 2008. Cost Principle: From an accountants view point, the term cost refers to the money spent (cash equivalent or cash) when an item wasÂÂ  originallyÂÂ  obtained, whether that purchase happened 2 years ago or fifty years ago. So, the amounts shown on the financial statements are referred asÂÂ  historicalÂÂ  cost amounts. In view of this principle, assets are not adjusted in accordance with the inflation factor. A n increase in value cannot be reflected by making changes to the assets. Thus, if an asset were to be sold at their present prices it would not tell how much amount of money a company would finally recieve. However, an exception to the above are the investments made in the stock exchange in the trading of bonds and stocks. To get the value of a companys long term assets one needs to look for a third party because it is not reflected in the financial statements of the company. Full Disclosure Principle: If some important information of an investor or lender is there using the financial statements, that information has to be disclosed in the statement or in the notes of the statement. It is due to this accounting principle that many footnotes have to be attached to the financial statements. As an example, lets say a company X is named in a lawsuit that demands a lot of money. When the financial statements are prepared it is not clear if the company X would win or lose the law suit. Because of this principle the lawsuit will be described in the notes to the financial statements. A company generally lists its significant accounting policies as the first note to its financial statements. Going Concern Principle: The basic assumption made by the accounting principle is that a company will fulfill all its functions, objectives and at the same time will not liquidate in the following course of time. However, if the accountant believes that the company is in a financial crunch and will not be able to carry its work forward, he is required to make this assessment public. In such a situation the going concern principle allows the company to postpone part of its prepaid expenses to another time or till one of the future accounting periods Matching Principle: This above stated principle uses accrual basis of accounting i.e. the expenses must be synchronized with the revenues. For example, sales commissions expense should be recorded in the time period w hen the actual sales were carried out and not in the time period of payment of commissions. Similarly, wages are calculated as expense in the period when the employees actually worked excluding the period when the wages were dispersed. If a company decides on a bonus of 3% of its 2008 revenues on January 25, 2010, the bonus would be included in its expenses of 2008 and the amount unpaid at December 31, 2008 is considered as a liability. Since there are no means to measure the future economic profit of things like advertisements the accountant makes sure that the ad amount to expense is charged only in the period when the ad is shown. Revenue Recognition Principle: Under the accrual basis of accounting (as opposed to theÂÂ  cash basis of accounting),ÂÂ  revenuesÂÂ  are recognized as soon as a product is sold, and not when the money was received. Under this basic principle, a company could earn and report $40,000 of revenue in the first month of operation but rece ive $0 in actual cash in that month. For example, if ABC Consulting completes its service at an agreed price of $1,000, ABC should recognize $1,000 of revenue as soon as its work is done-it does not matter whether the client pays the $1,000 immediately or in a month. Do not confuseÂÂ  revenueÂÂ  with aÂÂ  cash receipt. Materiality: Because of this principle or guideline, an accountant might be allowed to violate another accounting principle if an amount is insignificant. An example of an obviously immaterial item is the purchase of a $165 scanner by a multi-million dollar company. Since the scanner will be used for four years, theÂÂ  matchingÂÂ  principle directs the accountant to expense the cost over the four-year period. TheÂÂ  materialityÂÂ  guideline allows this company to violate the matching principle and to expense the entire cost of $165 in the year it was purchased. The justification is that no one would consider it misleading ev en if $165 is expensed in the first year instead of $40 being expensed in each of the four years that it is used. Because of this principle, financial statements usually show amounts rounded off. Conservatism: If there is a situation which has two alternatives, then according to this principle the accountant can choose the alternative which will result in less asset amount and/or less net income. Accountants should not be biased. The basic accounting principle of conservatism leads accountants to show losses, but it does not allow them to show gains. For example,ÂÂ  losses from lawsuits will be shown in the financial statements or in the notes, butÂÂ  potentialÂÂ  gains wont be shown. Also, an accountant may give the amount of inventory less than the actual cost, but not vice versa. REFRENCES https://www.accountingcoach.com/online-accounting-course/09Xpg01.html

Nature versus Nurture Debate Essays - 776 Words

Factually Naturally People have been arguing about nature versus nurture for centuries. Does genetics or upraising have more effect on a person? Human development is influenced by various things. But nature, genetics, contributes more to development than the environment does. While nurture has some influence, nature has much more. Genes are responsible for altruism, personality is linked to individual genes, and genetic disorders are effects of nature that can cause drastic differences in quality of life. Genetics determine more of human development than environment. Nature is what determines altruism, personality, and genetic disorders. Much work and research has been done to support this, with various studies on each topic, like†¦show more content†¦Another developmental trait nature contributes to is the trait of personality, as shown by studies in dopamine, twins, and bees. Scientists have long been interested in how genes affect personality. One promising gene studied was dopamine. Dopamine genes account for 6.6% of behavior related to sensation seeking. Other studies have failed because they study genes as if a single gene has a direct relationship with a part of personality. This study studies different genes working together to see how personality is affected, and unlike other studies, definitely found a correlation between a gene and personality. To further findings in personality, work has been done looking at twins. Of studies in personality in twins, it has been found that personality is definitely influenced by genes. A larg e study in overall twin personality say that identical twins have 46% of personality come from genes. In fraternal twins, this gene influence is half, 23%. These studies’ results are very clear in that genes do have some effects on personality. And in a third, different area of study, bees were studied. When studying RNA in bees, scientists found that changes in RNA determine behavior. By studying the correlation between RNA and bees’ behavior, they could predict whether or not a honeybee would become a forager or a hive worker. These studies in RNA have prompted promising studies in human RNA and itsShow MoreRelatedThe Debate On Nature Versus Nurture Essay969 Words   |  4 Pagesdetermine its form† (Fraser). The debate on nature versus Nurture has been a mystery for years now, constantly begging the question on what has a greater effect on the human development of humans. Is human behavior, ideas, and feelings innate or are they learned over time. Nature, or genetic influences, are formed before birth and shaped through early experiences. Genes are viewed as long and complicated chains that are present thought lif e and develop over time. Nature supporters believe that genesRead MoreThe Nature Versus Nurture Debate Essay1911 Words   |  8 Pagesbut our genes are not talked about as much when behavior is the topic. This is how the nature versus nurture debate came about. Scientists who believe in the nature theory believe that people behave the way they do due to heredity and genes. On the other hand, nurture scientists believes behavior is taught and influenced by the environment and the surrounding people. Many say that behavior results from nature, while others believe in the opposite, the environment. Human development has been viewedRead MoreAn Debate On Nature Versus Nurture1082 Words   |  5 PagesConstructing Identity There has been an ongoing debate on nature versus nurture that has been around for years. What determines our identity? Our biological nature or the things we grew up around? The answers to these questions still remain uncertain, but are still widely discussed. Deborah Blum shares her opinions on these issues in â€Å"Gender Blur†. In her writing, she challenges where we separate biology from society. While our biological nature determines our gender, our surroundings and the thingsRead MoreThe Nurture Versus Nature Debate1743 Words   |  7 PagesThe nurture versus nature debate is commonly seen as one of the most important issues in psychology. It is assuredly one of the best researched, with various studies dating back to the beginning of the 20th century. Two schools of individual difference theorists clearly differ in their approach to this question. The first school of thought, implanted in social psychology and sociology, claims that the environment is of principal im portance in determining how individuals behave. For these theoristsRead MoreNature Vs. Nurture : The Debate Of Nature Versus Nurture895 Words   |  4 PagesNature vs. Nurture The debate of nature versus nurture has been an ongoing debate for a long time. When applying this argument to education there is no proven winner. The nature side of the coin believes that a person is born the way that they are. This could include intelligence level or personality traits such as being outgoing or shy. The other side of the argument of nurture believes that the type of upbringing that someone has will play a large role in the way they develop. It is thoughtRead MoreEssay on Nature Versus Nurture Debate987 Words   |  4 PagesThe nature versus nurture debate is one of the oldest and most controversial issues in Psychology. The nature versus nurture debate revolves around the contributions of genetic factors and environmental factors to human development. The primary method of attempting to determine which of these effects human development the most has been cross-cultural studies. Cross-cultural studies are studies conducted across more than one culture, based on the assumption that the differences between cultures geneticallyRead MoreNature Versus Nurture Has Been A Big Debate In The Past1433 Words   |  6 Pages Nature versus nurture has been a big debate in the past few years. Debates and arguments from both sides has its own statements which makes their side stronger. Some argue that it is in the genetics if a person is intelligent where some state the opposite, that surroundings make a person intelligent which improves them in a person mentally and physically. In the 1950s psychologist Harry Harlow studied the effects of maternal deprivation on the development of baby monkeys. Some philosophers suchRead MoreThe Formula for Fruition: The Age Old Debate of Nature Versus Nurture by Kendra Cherry1508 Words   |  7 PagesThe Formula for Fruition: Nature vs. Nurture The Story of My Search Have you ever wondered what makes a person successful? Why is it that people who grow up in the same environment grow up to have such different qualities of life? As a child of two parents who would be considered â€Å"successful† by society, I’ve always wondered how differently I would perform in life had I been the child of different people or raised in a different environment. I’d heard plenty of stories about people coming from badRead MoreThe Nature Versus Nurture Controversial Debate1492 Words   |  6 PagesIntroduction The nature-versus-nurture controversial debate has always been central to the theme of development. Naturally, several predominant theories come to the fore and place different weights on nature and nurture. My concept of interest is active adaptation theory, which falls on the relatively endogenous side of the scale of source of developmental change. From the active adaptation perspective, individuals play an active role in their development; they possess the power to influence theirRead MoreEssay about Child Development, Nature vs Nurture801 Words   |  4 Pages. The nature versus nurture debate is one of the oldest issues in psychology. The debate centers on the relative contributions ofgenetic inheritance  and  environmental factors  to human development. 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Trench Warfare free essay sample

One was a four year war, it started in 1914 and ended in 1918. over 12 countries were involved, for example Belgium, France, Italy and America. WW1 started for many reasons. For instance militarism (building up strong armed forces to prepare for war), Alliances (an agreement between counties to work together to achieve a common goal), imperialism (policy of powerful countries seeking to control the economic and political affairs of weaker or smaller countries) and nationalism (strong feeling of pride, loyalty and protectiveness for ones country. Also Germany wanted control over the world. WW1 was very special though. It was unique for many reasons, like Trench Warfare, propaganda and all of the new weaponry. Trench Warfare was a form of fighting in WW1 with heavy artillery bombardments, attacks and counter attacks across open land, and the use of poison gas. No body expected the war to last as long as it did (4 years). Trenches were built to protect yourself from the enemy(s). Trenches were generally around two meters deep and two meters wide. There was three rows. The first row was called the frontline trench. The frontline was the closest to no mans land (the land controlled by neither side of a war), it was also the most dangerous because that was were most of the fighting went on. The second row was called the support trench. It was back-up to the frontline, just in case the enemy got passed. The third and last row was called the reserves. This is were they kept all the supplies and equipment. Also there was communication tunnels connecting the trenches, they were used to transport supplies and messages to the other trenches. Trenches were very unhealthy. Lice, rats and all sorts of vermin occupied the trenches. There was little to no running water, the bathrooms consisted of a bucket in the trench. Also there was dead bodies covering all of the land. Worst of all, there was rats. They would eat dead bodies, or eat out the eyes and live in the bodies of the dead. Rats would nibble the living while they slept or when they were wounded. The other horrible parasite was lice. Lice is hard to get rid of and it spreads quickly. Lice also caused Trench Fever, Trench Fever was a disease that began with severe pain and a high fever. The only way to cure trench fever was to spend at least 12 weeks away from any trenches. The weather conditions in trenches were horrible. Most of the trenches were cold and muddy. Many soldiers died from the cold. The weather in trenches could reach below zero in the winter. Men would loose fingers and toes because of frostbite. Trenches were almost always filled with rain, sometimes up to there waist. The soldiers would get Trench Foot, it was caused from standing in the rain filled trenches for so long. Trench foot was excruciatingly painful. In most cases your foot would have to be amputated. As seen in Document One Private Michael Riley said â€Å"I’ve a little wet home in a trench where the rainstorms continually drench,† he tells how the conditions in the trenches were, cold and rained all of the time. Trench Warfare made WW1 different because in all of the other wars we did not use trenches. The second thing that made WW1 unique was propaganda. Propaganda is information that spreads ideas and influences someone’s thoughts or actions. This was used during WW1 to sell the war and mobilize support. The U. S government would put out poster that would say something to convince you to not eat meat or wheat on certain days, join the army or buy liberty bonds. As seen in Document Five one of the posters says â€Å"Sow the seeds of victory! Plant raise your own vegetables,† this means they wanted you to plant your own food so that the army would have more. We were running low on supplies and not eating store bought goods and not eating meat or wheat everyday would help because our soldiers were not getting the nutrient they needed to stay strong and win the war. Also Document three shows all of the participants in major wars, for example the civil war: the North v. South and the Spanish-American War: Spain v. USA. Both of these wars involved only two countries. It also shows WW1 and all of its participants. The allies were Britain, France, Russian (1914-1917), USA (after 1917). The central powers were Germany, Ottoman Empire and Austria- Hungary. This was a huge war. Most of the world was involved, that is why propaganda was so important. It helped give the soldiers food and supplies for one of the largest wars in history. Also it lasted a long time and the USA was only involved after 1917 but we still lost many men. Propaganda gave the army all of the supplies after they ran out because the war was lasting longer than anyone thought. That was why propaganda was important and unique because we didn’t use this method in any other wars, it was not necessary. The last but not least thing that made WW1 so different was all of the new weaponry. The most used was the bolt action rifle, it fired 15 rounds a minute at a person 1,400 meters away. The second new weapon was the machine gun. Machine guns needed 4-6 men to work them and it had to be on a flat surface. They had the fire power of 100 guns. There was also large field guns that had a long range and could drive devastating blows to the enemy but they needed up to 12 men to work them. They fired shells that exploded on impact. Next there was gas. The German army were the first to use chlorine gas at the battle of Ypres in 1915. Chlorine gas causes a burning feeling in the throat and you got chest pains. Death is painful, you would suffocate. The problem with chlorine gas is that the weather must be right. If the wind is in the wrong direction it could end up killing your own troops rather than the enemy. Mustard gas was the most deadly weapon used. It was fired into the trenches in shells. It is colorless and takes 12 hours to take effect. The effects were: blistering skin, vomiting, sore eyes, internal and external bleeding. Death can take up to 5 weeks. In Document Four Henry says â€Å" on top of this, I encountered mustered gas for the first time last week. Fortunately, I had my gas mask ready. The same could not be said for my friend, Heinrich. To see someone die such a death is a horror I will never forget,† Henry saw his friend die from mustered gas. It was a horrible sight, dieing is a slow and painful process. Some men have to be strapped to their hospital bed while they scream till their death. Additionally there was tanks. Tanks were used for the first time in the First World War at the Battle of the Somme. They were developed to cope with the conditions on the western front. The first tank was called Little Willie and needed a crew of 3 men. Its maximum speed was 3mph and it could not cross trenches. The more modern tank was not developed until just before the end of the war. It could carry 10 men, had a revolving turret and could reach 4mph. Furthermore there was planes. Planes were also used for the first time. At first they were used to deliver bombs and for spying work but became fighter aircraft armed with machine guns, bombs and some times cannons. Fights between two planes in the sky became known as dogfights. Last but not least there was torpedoes. Torpedoes were used by submarines. The Germans used torpedoes to blow up ships carrying supplies from America to Britain. The Germans torpedoed the passenger liner Lusitanian on May 1st 1915 which sank with a loss of 1,195 lives. Americans were outraged and joined the war in 1917 on the side of the allies. This is another reason why WW1 is different because we did not have all of this new weaponry. These where some of the reason that made WW1 unique. Thankfully the United States was only involved for about a year. It was still very hard on our country. Propaganda also gave our country an economic boost though, from everyone buying liberty bonds. In the end we sign the Treaty Of Versailles (1919) and we agree that Germany should be punished severely for the damage they made. They also had to have a small military and they had to give back their land over seas. The war officially ended on the 11th day of November on the 11th hour.

The impact of sexual abuse reaches all levels of a Essay Example For Students

The impact of sexual abuse reaches all levels of a Essay childsemotions. These emotions and the effects are listed below: Confusion: This is usually the initial reaction of the child. They will usually question, What is going on? and Is thisright or wrong?. For a young child these types of questionscan be an emense burden on their physcological development. Once the abuse begins the victim experience a tremnedous conflict with their emotions. They feel pleasant due to the attention they are recieving from the parent, as well as the sensual pleasure. Onthe other hand they experience pain, guilt, and anger for what is being done. The question, Is this right or wrong? posses the greatestconflict within the childs mind. The abuse feels so wrong yetthe abuser insits it is okay, taking advantage of the childsmistrust and naivety. Below are the thoughts of an abused victim as she thinks back to her abuse and questions her father. It isan example of this mistrust as well as the confusion which goesthrough a childs mind. We will write a custom essay on The impact of sexual abuse reaches all levels of a specifically for you for only $16.38 $13.9/page Order now Since I was a little tenyearold child, I had to deceive (#(#Kand hide from the world and my mother that my father tooka sexual interest in me. Remember how you taught me thatart of deceit? First you put me in a situation that had tobe kept a secret then you pledged me to secrecy As a tenyearold child, what was I supposed to do? You are an (#(#Kintelligent manyou figure out the options available to a (#(#Ktenyearold in that position. (Rush, 1980) P(P(P( Guilt:The abused will feel tremendous guilt for a numerousreasons: They feel they did nothing to stop the abuse thereforethey are responsible and it should continue.7 They felt uncomfortable but the abuse was sometimespleasureable.They somehow deserved and/or caused the abuse. Avictim will usually feel this way when their selfesteemhas diminshed and they have no more answers for what isFhappenning.A nineyearold girl had a nightmare and went to herfathers room for comfort but instead he sexually abused her.The girl then concluded that she caused the abuse by goingto his room. The abuse thereafter continued and she nowfelt she deserved for it to continue. (Landau, 1990)This fictional example helps to further illustrate the final2 points which were presented above. The guilt hits the child sohard that they are unable to clearly see reality.Another major source of guilt comes from the mother. Oftenwhen the mother is told about the abuse she will not want tobelieve the accusations and will blame the child. Other reasonsfor why the mother may pass guilt: 1) she may feel inequipped tochallange the husbands domination in any area of life thereforeshe shes passes the husbands faults and looks at the child. 2) The mother doesnt want to lose her husband. She does not wantto give up the security provided by her husband and will blockout the abuse.