INTRODUCTION TO ACCOUNTING

Accounting for Business

Accounting for Business

Introduction

The study is related to a restaurant which is owned and managed by Vincenzo Vasta. For the restaurant, it is important to follow the accounting techniques as it offers various benefits, for instance, it helps in determining the actual cost that incurred by the business and maintain the accounts of the business. Furthermore, the elements of the financial statements related to the components of the balance sheet and income statement, the first are those which form the accounting equation, and quantify their commitments and tax and accounting controls, classifying assets, liabilities, equity or equity accounting. The other elements referred to the income statement showing the revenues, costs, expenses and the effect of inflation restatement or adjustment called for inflation.

Description

For the future of the business, it is important that the restaurant should follow the accounting techniques. Accounting principles states assets, liabilities and their changes (cash flow) by a solid, continuous and documented account of all business transactions (Jane, 2008, 9-17). For the restaurant, accounting records in accordance with the law on accounting can be the chief accountant or the accounts manager, adopted at the restaurant of Vincenzo Vasta under an employment contract.

Objective

The main objective of accounting is to form complete and accurate information (financial statements) on the activities of the restaurant and its property position, whereby it becomes possible in;

- Prevention of negative results of operations of the organization.

- Identification of farm reserves to ensure financial sustainability of the organization.

- Monitoring compliance with the implementation of an organization of business operations.

- Feasibility of control of business operations.

- Monitoring the presence and movement of assets and liabilities.

- Control the use of material, labor and financial resources.

- Monitoring compliance of the approved standards, specifications and estimates.

Accounting Transactions

For the restaurant business, it is important and essential that the Vincenzo Vasta should maintain all the head of accounts such as the assets, liabilities and equity as it will show the accurate picture of business profitability and will also reflect the transparency of the business (Adams, 2006, 87-94). In addition to this, maintain only the cash the business receives and the payments made will not present that the actual position of the restaurant. Therefore, it is crucial to have the proper accounting transactions for the restaurant.

Decision Making

To charge the daily price of the lunch or the products, it is important to consider all the expenses that have incurred while ...