Accounting Aspect of Value Added Tax in Bangladesh

It is founded on the argument that income statements and financial position ofaccounts change with sales. Sales forecast is the key determinant of the method of percentage of sales. Based on this method, financial statements of Pro-Forma can beprepared. In addition, the Body Shop will be able to identify external financial need (EFN). In this method, the first step is usually the expression of the income statements and balance sheet accounts which differ directly with change in sales. The Body shop company will do this by dividing the balance for the accounts for (2001) by sales revenue for the current year (2001). In the Body Shop balance sheet, the accounts which are generally tied with sales are cash (calculated as 3.7%), inventories (calculated as 13.7%),and net fixed assets (calculated as 29.6%), other current assets (calculated as 4.7%),accounts receivables (calculated as 8.1%), other assets (calculated as 1.8%), and accounts payable (which is 2.9%).The overdrafts, other current liabilities, and long-term liabilities are not tied with sales directly. The change that result in these accounts depends on the method Body Shop decides to employ in raising the required amount of cash to sustain the sales growth as forecasted. For income statements, costs are also expressed as the percentage of sales. The assumption in this case is that all costs remain at a sales percentage that is fixed. The cost of sales

An accounting cycle is a process, or a series of activities, that consists of collecting an organization’s transactions at the end of a reporting period to prepare essential financial statements of a business (Fleury, 2015). The accounting cycle is a strict, methodical set of rules used to ensure the accuracy and conformity of financial statements (Investopedia, 2017). The steps involved with an accounting cycle, the roles each of the step facilitate, the impact of omission, and what financial statements are assembled from the accounting cycle data.

From the analysis, relevant requirements to CCA are AASB 112 para. 79 and 80 (a), (b), (c) and (e), which require expense components to disclose separately. Also, para. 81(ab), (c(1)), (g) and 82A, regarding separate disclosure of tax consequences of other comprehensive income, numerical representation clarifying the relationship between tax expense and accounting profit, disclosure of amount of deferred tax assets and liabilities in balance sheet and income tax expense in income statement, and potential tax consequences have been followed respectively.

In this paper, I will describe the State and Local Government accounting, using the modified accrual revenue recognition. Using the modified accrual revenue recognition, will follow in description of what it actually measures. Followed by the use of the modified accrual revenue recognition, I will discuss the guidance of the governmental fund expenditure recognition, its definition and recognition. With discussion of expenditures accounting for governmental funds, I will present the importance of recognition. Moreover, there are the reporting guidelines of expenditures in governmental funds.

The Purchasing Department also need the books to find out what they can buy so that planning is made easier as well as budgeting for the available resources. It is a crucial aspect that accounting will determine how the materials and goods bought will be accommodated to the right department like bakery.

definitely recognize the importance of this as seen through their capturing of the company’s sales in percentage according to different categories of items. Various items such as foods, sundries, hardliners and fresh foods among others have been captured in the company’s annual report according to their percentage volume of net sales for the company for the last three financial years. The categorisation of items allows both the company’s directors and outsiders to keep up with the economic reality of the company’s performance over the last few years. The directors can then, for example, decide to increase the amount of warehouse space afforded to foods depending on the consistent performance of the category in terms of percentage volume of sales.

16. Which of the following federal officials is a "principal" of the Joint Financial Management Improvement Program who considers and approves or disapproves accounting and reporting standards recommended by the Federal Accounting Standards Advisory Board?

Inventory at beginning of year . . . . . . . . . . . . . . . . Purchases less cost of items withdrawn for personal use . . . . . . . Cost of labor . . . . . . . . . . . . . . . . . . . . . Additional section 263A costs (attach statement) . . . . . . . . . . Other costs (attach statement) . . . . . . . . . . . . . . . Total. Add lines 1 through 5 . . . . . . . . . . . . . . . . Inventory at end of year . . . . . . . . . . . . . . . . . Cost of goods sold. Subtract line 7 from line 6. Enter here and on page 1, line 2 Check all methods used for valuing closing inventory: (i) Cost as described in Regulations section 1.471-3 (ii) Lower of cost or market as described in Regulations section 1.471-4 Other (specify method used and attach explanation) (iii)

All profits belong to the owner of the business in addition to all debts, losses, and liabilities (Small Business Association). In order to form a sole proprietorship, a business owner must simply begin practicing their business. There are no legal or formal actions required to form a sole proprietorship (Malinak). In order to sustain, such a structure, one must obtain the correct licenses and permits. These are obtained by meeting legal requirements set by the state and local government for the applicable industry (Bloomsbury). When one is considering different business structures, they must also consider the taxation methods of the various structures, as these methods vary. In a sole proprietorship, the business is not taxed as a separate entity from the owner of the business as they are considered to be the same being (Small Business Association). Now that all of the information has been gathered on this structure, it is imperative to evaluate the advantages and the disadvantages of this model. The advantages of a sole proprietorship are simple and low-cost formation of the structure, complete control of business by sole owner, and low tax rates. Some disadvantages of a sole proprietorship would include complete personal liability and the difficulty of running a business as the lone owner and employee (Bloomsbury).

(Tax/Financial Year = I July – 30 June) – Income tax payable on a year-by-year basis s3-5 ITAA97.

This memo highlights segmented reporting and the variable approach to preparing income statements. Segmental reporting is necessary since there is a need to understand the cost data for each section. Proper cost allocation is critical to preparing the income statements, while it is also easier to identify the costs that are common and not attributable to any specific segment. Typically, the management analyzes the cost behavior by making the assumption that the total costs change occur because of change in level of a single activity (Slideshare, n.d.). The variable costing

The objective of AASB 116 is to stipulate the accounting treatment for property, plant and equipment, make user can understand information about an entity’s investment in its property, plant and equipment, and the changes in entity’s investment. The main issue for property, plant and equipment in accounting are the recognition of relationship between assets, the determination of their carrying amounts, the depreciation charges and impairment losses. AASB 116 required the entity disclose it’s information of gross carrying amount, depreciation method, depreciation rate, useful lives of PPE, accumulated depreciation and reconciliation of carrying amount at beginning of the reporting period and at end of the reporting period.

Firm has declared total dividends during this years 0.0013 (Million $) so DPS is also 0.0000427 (Million $). Khan Cloth Store cash purchase 0.0038(Million $) and total sales 0.0035(Million $) on credit. To determine their net income/loss on the cash basis of accounting, cash paid for purchases 0.0038(Million $) has been considered for this a loss of 0.0038(Million $) has been occurred. Since there is a loss of 0.0038 (Million $) so during this year no tax, no EPS and no DPS. Janata steels credit purchase 0.0051(Million $) and total sales 0.0046 (Million $) on credit. To determine their net income/loss on the cash basis of accounting, No revenue and expenses has been considered. During this year no tax, no EPS and no DPS for this firm. M/s Al-Madina Store credit purchase 0.0026 (Million $) and total sales 0.0019(Million $) on credit. To determine their net income/loss on the cash basis of accounting, No revenue and expenses has been considered. During this year no tax, no EPS and no DPS for this firm. To agree with matching principle we have shown the effect of accrual basis of accounting of the above

  Accounts receivable – gross   Allowance for doubtful debts  Accounts receivable – net     Plant at cost – gross   Accumulated depreciation  Plant at cost – net     Land at fair value    Development costs ‐ gross  Accumulated amortisation  Development costs – net     Interest receivable    Provision for long service leave    Asset revaluation reserve    Accumulated depreciation for income tax $  200,000  (10,000) 190,000    600,000  (120,000) 480,000    600,000  200,000  (80,000)  120,000 20,000    60,000   100,000    240,000

On the other hand, current value accounting provides an efficiency measurement. This is because the profit of the good or services will be separated and recorded as the business’s asset before it sold. The separation of business gain and business asset must be done to make sure the accuracy of calculation for a