Naming Cells in Excel for Easier Understanding
The main reason due to which cells in an excel sheet are named because it promotes clarity of as to what the excel sheet wants to shows and also to promote better understanding for the user (Liengme, 2015). When a cell is named it is easier to identify what calculations are associated with the same. In other words, the basic advantage of naming a cell is associated with the convenience of the users.
The negative figures or numbers are shown in brackets or highlighted red so as to differentiate the same with the positive figures. This is done to ensure that the users are able to identify with one look which are the negative figures in an excel sheet (Winston, 2016). Such negative figures normally arise when some calculations are being done using excel sheets.
In an excel system which is mostly used in countries nowadays, there is a separate area for presentation of data and a separate section for report. This is done to ensure that there is a comparability between the financial data and the report which is prepared. In addition to this, this approach ensures that the report does not get mixed up with the financial data and hamper the presentation of the entire segment (Mélard, 2014). If the report and the representation of the financial information are mixed up then error might happen which will hamper the accuracy of the whole spreadsheet.
One of the most used functions especially when there is a case of a condition for obtaining a result is the IF Function. The function basically is used for comparison between conditions and analyze whether the condition is established or not (Kanda, 2013). The results which can be obtained depends on the outcome of the analyze of the condition. If the condition is true than one answer will be generated and if the answer is false than another answer will be generated. A
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Perpetual Inventory System |
Periodic Inventory System |
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The system has the capability to track movement of inventories as and when such inventories arise (Berlemann & Wesselhöft, 2014). The system reviews the books for keeping track of the level of inventory |
As per this system, the inventory records are updated at periodic intervals as per the decision of the management (Cho?odowicz & Or?owski, 2015). This system applies physical verification of the inventories. |
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In this system, the companies update the inventory records and cost of goods sold figure continuously |
In this system, the inventory records and cost of good sold figure are not continuously updated but are updated on a periodic basis which is generally at the end of the year. |
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In this system, there is no need to record closing entries |
In this case the closing entries are needed to be recorded as per the requirement of the management. |
The use of excel spreadsheets in accounting process is nowadays widespread and most of the accounting professionals should have a detailed knowledge about the application of excel, the various formulas associated with the excel sheet. in addition to this, spreadsheet is also used by owners of businesses to keep a track of the revenues and incomes which the company earns or incurs during the year (Yue-gai, 2013).
In todays developing world any professional who has a view of establishing himself in accounting profession needs to have adequate skills and knowledge necessary for excel as most of the accounting firms use excel spreadsheet for such purposes unless any better software. Thus, in order to survive accounting professionals should have knowledge and skills to handle MS Excel. The advantages of using excel spreadsheets are given below in point form:
- The most advantage of using excel spreadsheet is that it is very helpful for calculation which can be of any nature. The formula bar which is present in an excel is contains all variety of formulas which can used to solve any kind of equation or problem
- In addition to this, the spreadsheet format allows better presentation of the financial data and also comparability between the same(Dobashi, 2016).
Handling Negative Figures in Excel Sheets
The disadvantages of using Excel sheet are given below:
- A most important concern of using spread sheet is that the financial data will always be at a risk of being manipulated and the same needs to kept secure.
There are two methods which are used for estimating bad debts which are discussed below:
- Direct write off method: As per this method the estimated bad debt amount which is deemed to be uncollectable is immediately written off from the figure of sales revenue of the business.
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Date |
Particulars |
L/F |
Amount ($) |
Amount ($) |
|
31/1/2018 |
Bad Debt Expense Account…….Dr |
8000 |
||
|
To Accounts Receivable Account |
8000 |
|||
|
(Being writing-off of the debtor’s account) |
Allowance Method: In this method, the amount of sales revenue which is deemed to be uncollectable is recorded in the same year as revenues from sales and shown as estimated bad debts. The bad debts which are written off are debited to allowance account.
As the world is developing new system are being introduced which facilitates changes. The retail market has also changed drastically with the introduction of online retail marketing or e-commerce facilities. This provides an opportunity to business to expand its reach and serve as many customers as possible. For example, E-bay is a proper example of proper online marketing site. E-bay has a large number of goods to offer which ranges from clothes, food items, luxury products like branded watch, sunglasses. The use of computers are a key aspect in online marketing and just in case of E-bay, the retail shop has become popular as they provide all products in one stop destination just by placing an order online favorably by a computer.
As shown in the above created examples the sales amount to $ 12000 out which a $ 4000 is deemed to be unrecoverable and hence will be considered as bad debts for the company as shown in the calculation above.
Wesfarmers ltd is company which operates in Australia and is engaged in the business of providing retail, chemical, coal mining and Industrial production as well. The company is regarded to be one of the largest companies in terms of revenue generation.
As per the opinion of the management of the company, the company y will be sustainable if it addresses certain issues which are significant and ultimately affect the profitability of the company. The sustainability programs of the company consists of various engagements such as community partnership, health and safety plan, environmental protection and restoration. The company believes that the company needs to achieve sustainability in its process for long term business development.
The financial performance of the company is tremendous. The company has been earning an earning per share of $ 254.7 which is almost 6 times of the previous year’s EPS which suggest that the company is keeping the shareholders needs in the front and also aims to maximize the profits which are earned by the shareholders of the business. The return on equity which is also considered to be one of the important financial indicators show that the performance of the company in the year 2017 is extraordinary and the company has achieved a growth in return on equity which now comes to 12.4%. The total assets of the company has increased whereas the total liabilities has decreased which also depicts the performance of the business.
The table below show the performance of the company in terms of current assets and charts are also provided.
|
2016 |
2017 |
|
|
Current Assets: |
||
|
Cash and Cash Equivalents |
1013 |
611 |
|
Receivables- Trade and other |
1633 |
1628 |
|
Receivables- Finance advances and loans |
0 |
835 |
|
Inventories |
6,530 |
6,260 |
|
Derivatives |
247 |
54 |
|
Other Assets |
244 |
296 |
Reference
Berlemann, M., & Wesselhöft, J. E. (2014). Estimating aggregate capital stocks using the perpetual inventory method. Review of Economics, 65(1), 1-34.
Cho?odowicz, E., & Or?owski, P. (2015). A periodic inventory control system with adaptive reference stock level for long supply delay. Measurement Automation Monitoring, 61.
Dobashi, K. (2016). Development and Trial of Excel Macros for Time Series Cross Section Monitoring of Student Engagement: Analyzing Students’ Page Views of Course Materials. Procedia Computer Science, 96, 1086-1095.
Kallner, A. (2015). Microsoft Excel 2010 offers an improved random number generator allowing efficient simulation in chemical laboratory studies. Clinica Chimica Acta, 438, 210-211.
Kanda, Y. (2013). Investigation of the freely available easy-to-use software ‘EZR’for medical statistics. Bone marrow transplantation, 48(3), 452.
Liengme, B. (2015). A guide to Microsoft Excel 2013 for scientists and engineers. Academic Press.
Mélard, G. (2014). On the accuracy of statistical procedures in Microsoft Excel 2010. Computational statistics, 29(5), 1095-1128.
Winston, W. (2016). Microsoft Excel data analysis and business modeling. Microsoft press.
Yue-gai, W. A. N. G. (2013). Application of Vlookup Function of Excel in Daily Life [J]. Computer Programming Skills & Maintenance, 4, 038.
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