reflection on archetype

Institution affiliation

name

Reflective learning journal

Accounting is a financial communication in an organization or bussing rerating how processes are learning and measure the prosperity in economic matters(Godfry,2010). Accounting in reflective learning shows how best the understanding in the field is helpful in the real-life application of the accounting. Having accounting knowledge helps in day-to-day transactions and activities in technical skills of a business.

As I start my field activity, I have witnessed several terms in the accounting field are used in the business, they include have gained and losses measured through accounting. Assets are any resource owned by the company or entity and are controlled by it. Assets are used to provide value for the entity in the very best positive manner. Some asset types include vehicles, inventories PPE (property, plant, and equipment). Assets are calculated as

EQUATION; ASSETS = LIABILITIES + EQUITY

For example, if Renee purchases a machine to help in a business, that machine becomes an asset. However, the machine keeps on depreciating are time goes by and losing its value. Depreciation is the loss of importance of investment.

Liabilities are the amount that the company or business owe to their excellent provider including banks, lenders, supplier, and all the debts. Liability is the sacrifices the industry needs to take for its future in economic ways. They can either affect the business negatively or positively, according to the management decision learning the business entity. Liabilities are of three different types, current liability, non-current liability, and contingent liabilities. Weaknesses are obtained as follows.

EQUATION; LIABILITIES = ACCOUNTS PAYABLE + UNEARNED REVENUE + ACCRUED EXPENSES PORTION OF LONG TERM DEBT + SHORT TERM DEBT

A creditor in a business is the people that lenders money to the entity and the entity owes him as per the agreement of both for the extension purpose.

Debtors are the people that are given money by the entity and are owed by the business, and they are supposed to pay back to the company due to the time of the agreement.

Bad debts in accounting are the debtors who take longer than expected, and the business considers that as a bad debt since they are not sure if the debtor will pay back, and in the entry report, they are written in the wrong debt account. Bad debt is calculated by

BAD DEBTS EQUATION; DEBTS = PASSED BAD DEBT DIVIDED BY PASSED CREDIT SALES

In my accounting learning, I have come across income statements or profit and loss accounts, which show the expenses and revenues of an entity in a time, particularly a year. This report helps show how the revenues and expenses are transformed into profits and sometimes income there for maximum returns. Which is calculated as

NET PROFIT / NET INCOME EQUATION; INCOME = REVENUE – EXPENSES

In my stay in the accounting field, I have also seen the useful need for a bank reconciliation in the entity. A bank reconciliation is a process by which the bank statements of an entity are being reconciled in the financial books of account in the most recent updated manner. This helps in making sure that the bank’s account is in line with the accounts page in case the entity needs to be credited some cash for its expansion. Bank reconciliation is calculated as follows,

BANK RECONCILIATION EQUATION; BANK RECONCILIATION = (ALL CASH ACCOUNT BALANCE AS PER THE ENTRIES RECORDS) PLUS OR MINUS (RECONCILING ITEMS)

In my daily activity, I come across cash and receipt. This is a book of account that is used to record day to day sales that the customers pay in cash. This book of accounts helps to show how the dairy activity is operating. This account helps to show withdraws and deposits involved in everyday work. A cash book contains two sides of creditors and debtors involved in a single day. The cash receipt is also issued to the customer in case of any clarity that might be needed in the future.

My observation in accounting, after having known all about the business books of account, starting a business is the second most important thing. This comes after the person who needs to start it must have sported the gap in the community and is ready to fill it. After sporting the gap, the next thing is to locate the business site as to where you want to place the business according to the need of the people. The location of the business comes with the finding of the storage facility of the business, which should belong rusting and reliable. This is followed by the hiring of the employees and staff who will assist in the day to day activity. These staffs include the management system, who are key players in the entities in the future decision making.

Skills learned from the record-keeping of books of account.

In my stay in the accounting field, I can understand the meaning of accounting and keeping records of the day to day activities of an entity. Here are some of the things I am learning from this field of accounting practice. Having skills in bank reconciliation is a benefit to the entity since the bank gives the collect amount of money it can receive a loan for its expansion because of the future growth of the entity. Also, I think having knowledge in the profit and loss account are also is more beneficial since an entity is able to detect where the revenue is lost. Income is maximized since all revenues are detected at the end of the year statement; the entity is able to reduce its expenses by covering and redesign its unnecessary expenditure. Bad debts are useful in showing the way in which the entity is affected by the debtors. If the bad debts are not recovered for a long period of time, the entity should write them off since they are lost.

My observation in the accounting field is that for an entity to stay firm in an economical way, it should possess its asset which it has control over them. This asset can be used by the entity to secure loans from its creditors. The creditors use books of records to see if the business is capable of paying back.

In terms of liabilities, I have observed that they are some of the drawbacks to the entity; they should be recovered as fast as possible to help the firm’s business books of account record more profits in the day to operations.

During my field activities, I formulated some illustration of the records of accounts that are found in books of account that I uncounted, and they include,

1.1 Income statement

An example of an income statement that I obtained from books of account of my Isaac’s business that contains that a wholesaler shop during the period of one year.

Isaac wholesalers

Income statement

For the year ended 31 January 2020

Income

Income ****

Expenses

Electricity bills ****

Rent ****

Wages **** (******)

Net profit ******

1.2 Cash receipt journal

An example of the cash receipts journal that involves a business that is from a book of accounts from day to day activities.

Cash Receipts Journal

Date

Account

Cash at Bank

2019

Jun-02

R Wake

Sales

*****

****

Langer Ltd

C Nunn

Sales

***

*****

****

J Byron

***

16 22

S Banks

Sales

R Ricketts

*****

***

Cora Cannery Ltd

Sales

***

****

R Wake

***

Langer Ltd

R Ricketts – dishonored cheque

Sales

****

******

*****

1.3 Profit and loss account

An example of profit and loss account that I obtained from my peters books of account a businessman I uncounted during my field practice

My peter’s

Trading, profit and loss account as at 30 September 2019

Sales

***

Less

Cost of sales

Opening stock

****

Less closing stock

****

(****)

Gross profit

*****

Less expenses

*****

Net profit

*****

1.4 Bank reconciliation report

In my field activity, I come across a bank reconciliation from my peter’s books of account, which was updated to the current date. This bank reconciliation report can be used by creditors to tell the capability of my peter to pay back people money and if he pays as per the time agreed.

Bank Reconciliation Statement as at 31/12

Balance at bank as per bank statement

Add: Uncredited deposits

Errors on bank statement (note 2)

Less: Unpresented cheque

Errors on bank statement (note I)

Balance at bank as per cashbook (updated)

xx xx

During my stay in the field, I have learned some of the importance of having accounting knowledge in business. These books of accounts are so much helpful to any entity when it comes to the loan from creditors for the purpose of expansion in case there is growth in the business. This is advantageous to the firm in terms of dealing with economic challenges, including taxes, bills, loss of customers from time to time, demand, and supply. Some of the things I have learned from my earlier topics during my field activity is, for an entity to grow and develop in the best positive way, accounting experience is needed and has a great contribution for the same.

In the future, having learned some of the accounting activities, if, by the chase, I have a business of my own, I will use this accounting knowledge to make it grow and develop to a bigger and competing firm. In different parts of my learning activity, I have observed that they co-rerate to each other. For example, the dairy withdrawal and deposits are recorded into the cash receipts are reflected in the bank reconciliation report. This shows how different types of books of account relate to each other. Having gone through different types of books of account, I figured that when I compare my past perception on how I viewed accounting is a very different story. I can improve my learning in accounting through engaging in many practical ideals to expose my mind to different types of accounts. This helps to notice why some of the businesses are very successful than others and how they handle different types of accounts. From the feedback that I will receive from a different entity, I will use what I have been learning in my field activity to ensure growth in a business that I may have in the future.

In my opinion, I think accounting is the essential thing in any business setup. This is due to its usefulness in the growth and development of any small business to a big trading center. An entity with a good accounting system is easy to develop compared to the ones that don’t have one. Having gone through the accounting field activity, I have learned that having basic knowledge about accounting improves thinking capacity in the sense that it becomes easy to speculate changes in returns, and this is observed through the profit and loss account report. Accounting skills are also useful in helping the business owner to start to adjust to the economic changes the business may not have control over them.

My comment on the accounting field is that after having identified a gap in the community and you want to fill it, go to the nearest institution that offers a training section on accounting. After having few weeks of training in accounting, it becomes very easy to establish and put the ideal into use. Having gone through accounting training, it will be followed by the location of the business. When it comes to the hiring of the employee, especially in the accounting department, it needs people with knowledge of accounting, since this department, together with management, is the backbone of growth to a business. For businesses that do not experience rapid growth, I may advise the owners to take basic training sections on accounting. By so doing, it will boost their knowledge in learning their business, and to my opinion and the learning I have gone through, this will help the archiving their goals.

Reference

Godfrey, J., Hodgson, A., Tarca, A., Hamilton, J., & Holmen, S. (2010). Accounting. John Wiley & Sons, Inc.

Scott, W. R., & O’Brien, P. C. (1997). Financial accounting theory (Vol. 3, pp. 335-360). Upper Saddle River, NJ: Prentice hall.

Watts, R. L., & Zimmerman, J. L. (1986). Positive accounting theory.