The Hair Emporium

694 Words Nov 22nd, 2011 3 Pages
Abstract
1Identify what type of accounting records and financial statements should be offered to the Franchisees?

Every franchisor or franchisee must keep a set of financial records. Too often the franchisee or a franchisor is a beginner, opening a business for the first time, and is not fully aware of what it takes to run a business, particular from the point of view of managing the finance.
Accounting is a process of measuring and reporting financial information of the franchise. Accounting information is economic information’s. It relates to the financial or economic activities of the business or organization. Financial statements are informational pictures of the financial statues of a particular business firm for a certain
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The balance sheet will also indicate the different between the monies received from creditors or loans (liabilities or debts) and funds put into the business by the owners. (. The credit worthiness of the business is determined by the information that these reports provide. Detail from a Balance Sheet report can be used to determine the cash flow that is available to finance growth or repay debt.
3Explain why or why not there should be a recommendation on common accounting procedures for all franchisees.
The best way to determine if projected resources will cover the franchise year expenses is to prepare a cash flow balance sheet containing monthly expenses and resources. You can then compare expenses with the resources and income you project will be available during the year. The balance sheet gives you this view of your equity so that you can see what equity would be if all the cash that is currently committed were already spent. Balance Sheet reports are commonly run at the end of accounting cycles, usually monthly or at the end of the fiscal year, and they are particularly useful when they are analyzed over time. Comparing reports on a monthly or yearly basis can reveal important information about business trends, such as the ability to collect sales revenues, how you manage the inventory, and your success in paying creditors. Balance sheet can be produced quarterly, semiannually, or at the end of each calendar or

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