The On Demand Global Workforce - oDesk

Thursday, September 1, 2011

Principle of Finance

The Role and Environment of Finance

   2.Accrual income versus cash flow for a period Thomas Book sales,Inc,Supplies textbooks to collage and university bookstores.The books are shipped with a proviso that they must be paid for and billed titles totaling TK.7,60,000 Collections, net of return credits , during the year totaled TK.690,000 . The company spent TK.300,000 acquiring the books that it shipped.
a.Using accrual accounting and the preceding values, show the firm's net profit for the past year.
b.Using cash accounting and the preceding values,show the firm's net cash flow for the past year.
c.Which of these statements is more useful to the financial manager ? why?

Solution
a.Net profit                     =Sales-cost of goods sold
                                        =760,000-300,000
                                        =TK.460,000
b.Net Cash flow             =Cash receipts-Cost of goods sold
                                       =6,90,000-3,00,000
                                       =3,90,000
c.The cash flow statement is more useful to financial manager The accounting net income includes amounts that will not be collected and as a results,do not contribute to the wealth of the owners. 


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3.Liability comparisons Merideth Harper has invested TK.25,000 in Southwest Development Company. The firm has recently declared bankruptcy and has TK.60,000 in unpaid debts. Explain the nature of payments, if any, by Ms.Harper in each of the following situations.
a.Southwest Development Company is a sole proprietorship owned by Ms.Harper.
b.Southwest Development Company is a  50-50 partnership of Ms.Harper and Christopher Black.
c.Southwest Development Company is a corporation.
Solution
a.Ms.Harper has unlimited liability.
b.Ms.Harper has unlimited liability.
c.Ms.Harper has limited liability, which guarantees that see cannot lose more than she invested. 

Principle of Finance

The Role and Environment of Finance

                                          part-B & C

1.Marginal analysis and the goal of the firm ken allen,capital  budgeting analyst for Bally Gears,
Inc has been asked to evaluate a proposal. The manager of the automotive diviesion believes that  
replacing the robotics used on the heavy truck gear line will produce total benefits of TK. 560,000 (in today's the) over the next 5 years. The existing robotics would produce benefits of TK.400,000 (also in today's) over that same time period. An initial cash investment of TK.220,000 would be required to install the new equipment . The manager estimates that the existing robotics can be sold for TK.70,000. Show how ken will apply marginal analysis techniques to determine the following:
a.The marginal (added) cost of the proposed new robotics.
b.The marginal (added)benefits of the proposed new robotics.
c.The net benefit of the proposed new robotics.
d.What should ken Allen recommend that the company do?why?
e.What factor besides the costs and benefits should be considered before the final decision is made?

Solution:
a.Marginal benefits=(New robotics-existing robotics)
                                =(5,60,000-4,00,000)
                                =TK.1,60,000
b.Marginal costs    =(Initial cash investment-sales of old robotics)
                                =(2,20,000-70,000)
                                =TK.1,50,000.
c.Marginal benefit =Marginal costs-Net benefits
                                =1,60,000-1,50,000
                                =TK.10,000
d.Ken should recommend that the  company replace the old robotics with the new robotics.The net benefit to shareholders is positive which should make the shareholders better off.
e.Ken should consider more than just net benefit.He should in corporate the important points of timing, cash flow, and risk, three important factors to determining the true impact on shareholder's wealth.  
  

Wednesday, August 31, 2011

Amar Shopnera aj Oshohay

Dikbistritho Digonte, Jhoru hawayi
Bose asi eka , Tepantorer pothe
Ronghin akash , r
megheder durlob lukuchuri
Klanto , Visinno , Obosadgrostho, ai ami
Dushor bikele ekaki
Sudu ekta kotha e ase bolar
amar shopnera aj oshohay.

Ronghin alukbelay , Nistobdo nogorithe
Vurer prothom prohore
Ekaki sunno rstay hatthe hatthe
Ektu abese, Moner kune
Vese uthe fele asa Rongin Sopnoguli
Ja aj hoye geche Ronghin,
Amar kche.

 Sesh rather ai rajpothe
Chitkar kore bolte icche kore
Tumra ki paro na, amar sopnogulu k
   firye dite.
 ki luv? k sunbe amar chitkar .
Tobu hete jai pothe , Kakdaka vure
Sohorer oligolite
Ronigin kunu asay.
Jani pabo na kichu e.
Amar Sopno gulu aj Oshohay.


Monday, August 29, 2011

The Accounting Process

Part-A
Brief Questions
4th part

25.What is General Journal?
Ans:The most basic form of journal.

26.What is Journalizing?
Ans:The entering of transaction data in the journal.

27.What is Posting?
Ans:The procedure of transferring journal entries to the ledger accounts.

28.What is simple entry?
Ans:A journal entry that involves only two accounts.

29.What is T-account?
Ans:The basis form an account.

30.What is Ledger?
Ans:The entries group of accounts maintained by a company.

31.What is general ledger?
Ans:A ledger that contains all assets,liability,and owner's equity accounts.

32.What is Three-column form of account?
Ans:A form with columns for debit,credit and balance in an account.

Saturday, August 27, 2011

The Accounting Process

PART-A
Brief Questions
3rd Part

17.What is transactions?
Ans:The economic events of an enterprise that are recorded by accountants.

18.What is Account?
Ans:A record of increases and decreases in specific asset, Liability, or owner's equity items.

19.What is Chart of accounts?
Ans:A list of accounts and the account numbers that identify their location in the ledger.

20.What is Compound entry?
Ans:A journal entry that involves three or more accounts.

21.What is Credit ?
Ans:The right side of an account.

22.What is Debit ?
Ans:The left side of an account.

23.What is Double-entry system?
Ans:A system that records in appropriate accounts the dual effect of each transaction.

24.What is Journal?
Ans:An accounting recorded in which truncations are initially recorded in chronological order.  

The Accounting Process

  • Part-A
  • Brief Questions
  • 2nd Part
9.What is investments by owner ?
Ans:The assets put into the business by the owner.

10.What do you mean by Monetary unit assumption?
Ans:An assumption stating that only transaction data that can be expressed in terms of money be included in the accounting records.

11.What is net income ?
Ans:The amount by which revenues exceed expenses.

12.What is net loss?
Ans:The ownership claim on total assets.

13.What is owner equity?
Ans:The ownership claim on total assets.

14.What is Owner's equity ?
Ans:A financial statement that summarizes the changes in owner's equity for a specific period of time.

15.What do you mean by Proprietorship?
Ans:A business owned by one person.

16.What is Revenues?
Ans:The gross increase in owner's equity resulting from business activities entered into for the purpose of earning income.

The Accounting Process

  • PART-A
  • Brief Questions
  • 1st Part

1.Double Entry System is a
Ans:Recording System.

2.What is a Assets?
 Ans:Resources owned by a business.

3.What is Liabilities?
Ans:Creditors and owner's claims on total assets.

4.What do you mean by Drawings?
Ans: Withdrawal of cash or other assets from business for the personal use of the owners.

5.What is Balance Sheet?
Ans:A financial statement that reports the assets,liabilities,and owner's equity at a specific date.

6.What do you mean by economic entity assumption ?
Ans:An assumption that requires that the activities of the entity be kept separate and distinct from the activities of its owner and all other economic entities.

7.What is Expenses ?
Ans:The cost of assets consumed or services used in the process of earning revenue.

8.What is Income statement ?
Ans: A financial statement that presents the revenues and expenses and resulting net income or net loss of a company for a specific period of time.