Accounting & Finance for Non-Specialists,
6th edition
By Peter Atrill
Financial Times/ Prentice Hall
Distributed by Trans-Atlantic Publications Inc.
October 2008
ISBN: 9780273716945
592 Pages
$97.50 paper original
Description
Now in its sixth edition, this successful text introduces the basic principles and underlying concepts of accounting and finance. It adopts a practical, non-technical approach, making it the ideal text for students from non-accounting disciplines. The text is written from a 'user' perspective, demonstrating ways in which accounting statements and financial information can be used to improve the quality of decision making. topContents
1. Introduction to accounting and finance
Introduction
Learning objectives
What are accounting and finance?
Accounting and user needs
Not-for-rofit organisations
Accounting as a service function
The threshhold of materiality
Costs and benefits of accounting information
Accounting as an information system
Planning and control
Management and financial accounting
Has accounting become too interesting?
Why do I need to know anything about accounting and finance?
Business objectives
Summary
Key terms
Further reading
Review questions
2. Measuring and reporting financial position
Introduction
Learning objectives
The major financial statements - an overview
The balance sheet
The effect of trading operations on the balance sheet
The classification of assets
The classification of claims
Balance sheet formats
The balance sheet as a position at a point in time
Accounting conventions and the balance sheet
Accounting for goodwill and product brands
The basis of valuation of assets on the balance sheet
Interepting the balance sheet
Summary
Key terms
Further reading
Review questions
3. Measuring and reporting financial performance
Introduction
Learning objectives
The income statement (profit and loss account)
Relationship between the income statement and the balance sheet
The format of the income statement
The income statement - some further aspects
Profit measurement and the recognition of revenue
Profit measurement and the recognition of expenses
Profit measurement and the calculation of depreciation
Profit measurement and inventory costing methods
Profit measurement and the probem of bad or doubtful debts
Interpreting the income statement
Summary
Key terms
Further reading
Review questions
4. Accounting for limited companies
Introduction
Learning objectives
Generating wealth through limited companies
Managing a company - corporate governance and the role of directors
Financing limited companies
Raising share capital
Loans and other sources of finance
Restriction on the right of shareholders to make drawings of capital
Accounting for limited companies
The directors' duty to account
The need for accounting rules
The main sources of accounting rules
Directors report
Auditors
Accounting rules and the quality of financial statements
Summary
Key terms
Further reading
Review questions
5. Measuring and reporting cash flows
Introduction
Learning objectives
The cash flow statement
Preparing the cash flow statement
What does the cash flow statement tell us?
Summary
Key terms
Further reading
Review questions
6. Analysing and interpreting financial statements
Introduction
Learning objectives
Financial ratios
Financial ratio classifications
The need for comparison
Calculating the ratios
A brief overview
Profitability
Efficiency
The relationship between profitability and efficiency
Liquidity
Gearing
Investment ratios
Trend analysis
Ratios and prediction models
Limitations of ratio analysis
Summary
Key terms
Further reading
Review questions
7. Cost-volume-profit analysis
Introduction
Learning objectives
The behaviour of costs
Fixed costs
Variable costs
Semi-fixed costs
Break-even analysis
Contribution
Margin of safety and operation gearing
Marginal analysis
Accepting/rejecting special contracts
The most efficient use of scarce resources
Make or buy decisions
Closing or continuation decisions
Summary
Key terms
Further reading
Review questions
8. Full costing
Introduction
Learning objectives
The nature of full costing
Deriving full costs in a single product operation
Deriving full costs in multi-product organisations
Activity based costing (ABC)
Uses of full cost information
Criticisms of full costing
Summary
Key terms
Further reading
Review questions
9. Budgets
Introduction
Learning objectives
Budgets, long term plans and corporate objectives
Time horizon of plans and budgets
Budgets and forecasts
The interrelationship of various budgets
The uses of budgets
The extent that budgets are prepared
Preparing the cash budget
Preparing other budgets
Using budgets for control
Comparing the actual performance with the budget
Stadard quantities and cost
Reasons for adverse variances
Investigating variances
Compensating variances
Making budgetary control effective
Limitations of the traditional approach to control through variances and standards
Behavioural aspects of budgetary control
Summary
Key terms
Further reading
Review questions
10. Making capital investment decisions
Introduction
Learning objectives
The nature of investment decisions
Methods of investment appraisal
Accounting rate of return (ARR)
Payback period (PP)
Net present value (NPV)
Why NPV is superior to ARR and PP
Internal rate of return (IRR)
Some practical points
Investment appraisal in practice
Summary
Key terms
Further reading
Review questions
11. Managing working capital
Introduction
Learning objectives
The nature and purpose of working capital
The scale of working capital
Managing inventories (stock)
Managing receivables (debtors)
Managing cash
Managing trade payables (creditors)
Summary
Key terms
Further reading
Review questions
12. Financing a business
Introduction
Learning objectives
Sources of finance
Internal sources of financing
Sources of external finance
Gearing and the long term finance decision
Share issues
The role of the stock exchange
Short term sources of external finance
Providing long term finance for the small business
Summary
Key terms
Further reading
Review questions
Glossary of key terms
Solutions to self-assessment questions
Solutions to selected exercises
Index
Features
The sixth edition has been fully updated and revised throughout and has the following key features:
- Fully revised and rewritten in line with International Accounting Standards
- Real World boxes demonstrate the practical application and value of concepts and techniques learnt.
- An 'open-learning' approach with numerous activities, worked examples and questions interspersed throughout the text to aid understanding makes the book ideal for self-study
- The decision making focus on the use of accounting information rather than the preparation is highly appropriate for tomorrow's business managers.
Now supported by the comprehensive MyAccountingLab resource package