Introduction To Accounting For Observe Ethical And Technical

Total amount of assets belonging to Tiny Tots

Describe about the Introduction to Accounting for Observe Ethical and Technical.

1. Total amount of assets belonging to Tiny Tots

Current assets             $

Cash                         1500

Prepaid rent           1000

Total                        2500

Non-current liabilities

Equipment           10000

Total                     12500

Total Amount of liabilities

Current liabilities                   $

Wages  payable                   2500

Accounts payable               4500

Non current liabilities

Notes payable                    1000

TOTAL                                 8000

C) Using the accounting equation, what is the amount of Owners’ Equity reported on Tiny Tots balance sheet

Accounting equation states that Assets= liabilities + owners equity

Assets= $12500

Liabilities=$8000

Owners Equity= 12500-8000= $4500

d)How much net profit did Tiny Tots have for the year

 tiny Tots Ltd

Net profits for the year

Revenues          $4000

Less: Expenses  $2000

Net Profit             $2000

2.  Plata Ltd

Balance Sheet statement

As At 30^th June

Current Assets                                                           $

Cash                                                                     131950

 Receivable                                                             70300

inventories                                                              13026

Prepaid insurance                                                   1500

 Non  Current Assets

Plant and Equipment                                              183000

Intangible Assets

Intangible                                                               8750

Total Assets                                                        408526

Financed By:

CAPITAL                                                                         198626

Retained Profits                                                      44950

LIABILITIES

Current liabilities

Accounts payable                                                      8500

Salaries payable                                                         1450

30% interest bearing                                                  46500

Non Current Liabilities

Long term liabilities                                                               108500

Total Liabilities and Capital                                                 408526

3. To: John Minor

From: Frank Grey (CPA)

Subject  how ethics impact  a CPA (Certified Practising Accountant

The accountants  boards all over the world are responsible for the development of accounting ethical values. These regulatory bodies requires practising accountants to act responsibly when serving the public. Accountants should act responsibly when reviewing sensitive financial information and also when engaging in any accounting services(Clarke, 2005). Sound Moral judgement should be exercised by a practising accountant in all their activities. While providing clients with professional services, accountants are expected to present accurate and truthful assessment of the company and its financial health to the public(Duska & Duska, 2003).

In accounting profession, integrity is a fundamental element. This requires accountants to be forthright,  honest and candid with a client with regards to financial information. Accountants are required to restrict themselves from personal gain and the urge of taking advantage of confidential information. Integrity allows clients to get good information from the accountant. There are instances where differences of opinion or errors regarding applicability of laws in accounting, integrity enables accountants to avoid manipulating financial information and intentionally deceiving clients (Jeffrey, 2005). Ethics ensure accountants act in a consistent and professional  manner. In the absence of standards, it is required that accountants should act in accordance to commonly accepted principles.

Independence and objectivity are critical ethical values in accounting profession. When conducting business and offering services, accountants should remain free from conflict of interest and business relationships that are questionable (Jeffrey, 2008). Objectivity and independence ensures that an accountant provides information about a company that is factual and honest (Marriott, Edwards, & Mellett, 2002). For accountants who perform more than one function for a single client, for example auditing, management advisory and tax services, they may compromise their independence and objectivity. Because an accountant may be reviewing their own work when auditing the same work hence objectivity and independence is vital for an accountant.

Due care is an ethical value requiring an accountant to observe ethical and technical accounting standards set in the profession. In this case, Generally Accepted Accounting Principles (GAAP) are used by the accountant (Professional ethics in accounting and finance, 2010). Due care requires professional accountants like us  to exercise diligence, competence and a proper understanding of the financial information. Competence is based on experience and education, hence, due care requires experienced accountants to direct other accountants who have less experience in the profession.

References

Clarke, E. (2005). Accounting. South Melbourne, Vic.: Thomson.

Duska, R. & Duska, B. (2003). Accounting ethics. Malden, MA: Blackwell Pub.

Jeffrey, C. (2005). Research on professional responsibility and ethics in accounting. Amsterdam: Elsevier JAI.

Jeffrey, C. (2008). Research on professional responsibility and ethics in accounting. Bingley: Elsevier JAI.

Marriott, P., Edwards, J., & Mellett, H. (2002). Introduction to accounting. London: SAGE.

Professional ethics in accounting and finance. (2010). London.