“The accounting profit figure is simply a measure of the true profit of an organisation.” Discuss. In order to assess whether the accounting profit is a measure of the true profit it must first be shown that there is such a thing as true profit. If we decide there is, we then need to know what it is exactly, in order to assess the extent to which the accounting profit reflects this true profit figure. Before studying this module I believed that the true profit was essentially the accounting
Introduction In this written assignment, I am going to explain the difference between implicit and explicit costs. Also, I will provide two examples of when an explicit cost is different from an implicit cost. In addition, I will explain the difference between accounting and economic profit and provide two examples of when they differ.Finally, I will explain the difference between economies and diseconomies of scale and provide examples of when an actual firm might benefit from economies of scale
actually made and frequently recorded. They mirror payment for a business transaction such as salaries, rent, and utilities.(OpenStax Economics, 2016). Implicit costs being intangible are not frequently recorded. This sort of cost mirrors a potential opportunity, advantages, or points of interest that may have happened in a given circumstance. (OpenStax Economics, 2016) EXAMPLES OF WHEN AN EXPLICIT COST IS DIFFERENT FROM AN IMPLICIT COST 1. Implicit costs are expenses connected with utilizing a
business strategy. In what primary economic activity is ENDESA engaged? (HINT: the primary economic activity is not the generation and sale of electricity or related activities). Why is it necessary to understand the strategy and primary economic activity in order to manage ENDESA¡¦s financial activities? Managers should ensure that selected performance measurement system fits the unique requirements and business strategy of the firm. In general, primary economic activity of the company and its
Global Economic Environment Unit 3 Assignment u03a1 - Economic Problems 11/01/2014 Chapter 9, Discussion Question 2, p. 21 2. Distinguish between accounting profit, economic profit, and normal profit. Does accounting profit or economic profit determine how entrepreneurs allocate resources between different business ventures? Explain. Accounting profit is the profit that would appear on your accounting statement that you would report to the government for tax purposes. Economic profit is the
Profit Profit - the difference between the purchase price and the costs of bringing to market. - Is any amount of money that is left over from a company after all financial expenses have been paid. It is the money they are able to save once the business purchases have been made. - Is the money a business makes after accounting for all the expenses. - The positive gain from an investment or business operation after subtracting for all expenses. Opposite of loss.
In April 2001 the International Accounting Standards Board adopted IAS 12. IAS 12 has to do with the accounting treatment for Income Taxes. There have been many amendments and changes over the years with the last one being in 2010. The objective of International Accounting Standard 12 is to advise on the accounting treatment for income taxes. The main issue in accounting for income taxes is how to account for the current and future tax consequences of certain items. One item it advises on
as a basis for making decisions. Focus on the decision-making role of accounting system has to be elaborated. Also ratio analysis as decision tool with forecasting models is discussed. The basis concept of preparation of financial statement and its usefulness is included with ratio analysis. Cash flow analysis and financial planning with forecasted financial statement are covered. 4.2 Source of Financial Information. Accounting is the guide-post for management. A firm should know the financial implications
Cover page /Not yet ABSTACT / Not yet Content / Not yet Project Proposal University of West of England Project title To research on the influence of the difference between International accounting standard and Vietnam Accounting Standard to Sharemarket investor. CHAPTER ONE - Introduction Background to the study Financial information is a very important part in making investment decisions of sharemarket investors. Globalization and international capital growth requires the
brought in as revenues, how much spent on expenses, and the difference between the two is the net income profit. All figures above are in terms of millions. Excel rounded the depreciation value which was 1.5 to 2 and net income of 1.5 to 2 as well which gave total expense of 11 which is actually 10.5 million. I will attempt to explain the major components of this Income