ocr level 3 cambridge technicals in business unit 4: business accounting
TRANSCRIPT
OCR Level 3Cambridge Technicals
in Business
Unit 4: Business Accounting
Everywhere we look, we are confronted by businesses of every shape and size imaginable.
What is business What is business accounting?accounting?
From the giants of Ford, British Airways or HSBC to the local corner shop, driving instructor or your local
hairdresser.
Whatever size the business is, whatever product it makes or sells, however old or new it may be, every business will
require some form of accounting.
What is business What is business accounting?accounting?
All businesses will have to account for their finances and
their business activities
So, what exactly is So, what exactly is business accounting?business accounting?
Business accounting is about knowing how much money is in the business,
where it has come from, and how it is being used.
A manager presented with accurate accounting
information will be in a better position to make
more informed decisions.
So, what exactly is So, what exactly is business accounting?business accounting?
Money comes from:
- Sales - Investors - Lenders
Money is used to:
- Pay costs- Pay
dividends
Money is also used to re-invest in
the business
Understanding the purpose of these reports is a useful management skill in all industries.
Why do we need to do it?Why do we need to do it?
It is important to understand the purpose of business accounting, because business accounting reports are used by owners to make decisions.
These reports will be used to: record; monitor and measure;
manage and communicate business information.
Understand the purpose of
accounting and the categorisation of
business income and expenditure
What will you learn?What will you learn?After completing this unit you will:
Be able to prepare a cash flow forecast
Be able to review business performance
using simple ratio analysis
Be able to prepare profit and
loss accounts and balance
sheets
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