Final Accounts Preperation Flashcards
Who’s owns a sole trader?
An individual
Who owns a partnership?
Group of people
Who owns a limited liability partnership?
Members
Who own a limited company?
Shareholders
Who owns a charity?
Trustee
Who’s financial statements are private and not available to public?
Sole trader
Partnership
Who’s financial statements are available to the public through companies house?
Limited liability partnership
Limited company
Who’s financial statements are available to the public through Charity commission?
Charity
What are the accounting regulations for a Sole Trader?
- None
- financial statements are private and not available to public
What are the accounting regulations for a Partnership?
- Partnership Act, 1890
- Partnership agreement
- financial statements are private and no available to public
What are the accounting regulations for a Limited Liability Company?
- Limited liability partnership Act, 2000
- LLP agreement
- financial statements are available through companies house
What are the accounting regulations for a Limited Company?
- Companies Act, 2006
- Financial Reporting Standards
- Financial statements are available to the public through companies house
What are the accounting regulations for a Charity?
- Charities Act, 2011
- Charity regulators - the charity commission
- Statement of recommended practice (SORP) or FRS (Financial Reporting Standard) 102
- Financial statements are available to the public through the charity commission
What is the business entity principle?
financial statements record and report on the activities on one particular business
What is the materiality principle?
items with a low value are not worthwhile recording in the accounts separately
What is the going concern principle?
the presumption that the business to which the financial statements relate will continue to trade in the foreseeable future
What is the accruals principle?
income and expenses are matched so that they relate to the same goods or services and the same accounting period
What are the four accounting principles?
- going concern
- materiality
- accruals
- business entity
What is gross profit mark up?
profit percentage or fraction added to the buying price
What is the gross profit margin?
profit percentage or fraction based on the selling price
How do you do the goodwill account when someone joins the business?
Old Partners:
DR Goodwill
CR Capital
Add in New Partners:
DR Capital
CR goodwill
How do you do the goodwill account when someone retires from the business?
Old Partners:
DR Goodwill
CR Capital
Add in New Partners:
DR Capital
CR goodwill
How do you do the goodwill account when profit share changes in a business?
Old Partners:
DR Goodwill
CR Capital
Add in New Partners:
DR Capital
CR goodwill
