email response and Compare and Contrast spread sheets, assignment help

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PART ONE

Your response post should be in the form of a response as William Commerce, asking for clarification and making any adjustments to their policy formulation you see appropriate.

Dear Mr. Commerce,

I believe a company should estimate and record the anticipated uncollectible accounts because there should be a record of any bad debts of the company. By having documentation of this information it could help the company improve. We could record the revenues when earned; however, it is best to keep track of the revenues earned even before it comes in due to the Generally Accepted Accounting Principles.

In order for the company to keep loyal customers regardless of their debts we should continue to extend their credit unless it continues to get out of hand. Also in order to keep up with our competitors we should offer credit to our customers. However, the GAAP makes sure we recognize any expenses when incurred and also any revenue that tends to be associated with the expense to be recognized as well. Therefore, under the accrual basis of the GAAP we have to make sure it is recorded including the estimation of bad debts.

Yes, sir we do not currently have a standard policy for credit management in our company. However here is the policy we can utilize for granting, managing, and collecting accounts receivable for Commerce Commercials.

Policy

The overall policy of Commerce Commercial is to take the appropriate and cost effective actions to collect accounts receivable. The main objective is to make sure that any revenue generated by Commerce Commercial is collected and recognized by accrual basis or cash basis. The accrual basis method will be used if the payment is due anytime during or after the goods and services are sold. If payments for goods and services are required in advance then the cash basis method will be used.

PART TWO

Customer and Vendor Relationships

PART ONE

Your response post should be in the form of a response as William Commerce, asking for clarification and making any adjustments to their policy formulation you see appropriate.

Dear Mr. Commerce,

I believe a company should estimate and record the anticipated uncollectible accounts because there should be a record of any bad debts of the company. By having documentation of this information it could help the company improve. We could record the revenues when earned; however, it is best to keep track of the revenues earned even before it comes in due to the Generally Accepted Accounting Principles.

In order for the company to keep loyal customers regardless of their debts we should continue to extend their credit unless it continues to get out of hand. Also in order to keep up with our competitors we should offer credit to our customers. However, the GAAP makes sure we recognize any expenses when incurred and also any revenue that tends to be associated with the expense to be recognized as well. Therefore, under the accrual basis of the GAAP we have to make sure it is recorded including the estimation of bad debts.

Yes, sir we do not currently have a standard policy for credit management in our company. However here is the policy we can utilize for granting, managing, and collecting accounts receivable for Commerce Commercials.

Policy

The overall policy of Commerce Commercial is to take the appropriate and cost effective actions to collect accounts receivable. The main objective is to make sure that any revenue generated by Commerce Commercial is collected and recognized by accrual basis or cash basis. The accrual basis method will be used if the payment is due anytime during or after the goods and services are sold. If payments for goods and services are required in advance then the cash basis method will be used.

PART TWO

Customer and Vendor Relationships ATTACHED SHEETS!

Compare and Contrast the Chapter 4 ending Profit and Loss Statement through February with the end of Chapter 5 Profit and Loss statement through the end of March for Kristin Raina Interior Designs

Compare and Contrast the Balance Sheet as of February 28th with the balance sheet as of March 31st. After analyzing the statements, answer the following questions:

  • What is the financial situation of the company as of February 28th?
  • Did the financial situation improve, remain the same, or start to decline through the month of March?
  • What areas of strength exist in the company? What are the company’s weaknesses?
  • What are some areas where the company has opportunities for growth for the company’s financial situation?
  • In order to help you justify the above answers, financial ratios should be calculated. At minimum the following ratios should be calculated and used to support your arguments:
    • Debt to Equity Ratio (Total Liabilities/Equity) This ratio provides a look at how much the creditors have put into the company compared to how much the owners have put into the company.
    • Current Ratio (Current Assets/Current Liabilities) This provides a look at whether or not the business has enough current assets to pay their current liabilities.
    • Profit Margin (Net Income/Sales) This provides a measure of how much profit is earned on each dollar of sales.

the Chapter 4 ending Profit and Loss Statement through February with the end of Chapter 5 Profit and Loss statement through the end of March for Kristin Raina Interior Designs

Compare and Contrast the Balance Sheet as of February 28th with the balance sheet as of March 31st. After analyzing the statements, answer the following questions:

  • What is the financial situation of the company as of February 28th?
  • Did the financial situation improve, remain the same, or start to decline through the month of March?
  • What areas of strength exist in the company? What are the company’s weaknesses?
  • What are some areas where the company has opportunities for growth for the company’s financial situation?
  • In order to help you justify the above answers, financial ratios should be calculated. At minimum the following ratios should be calculated and used to support your arguments:
    • Debt to Equity Ratio (Total Liabilities/Equity) This ratio provides a look at how much the creditors have put into the company compared to how much the owners have put into the company.
    • Current Ratio (Current Assets/Current Liabilities) This provides a look at whether or not the business has enough current assets to pay their current liabilities.
    • Profit Margin (Net Income/Sales) This provides a measure of how much profit is earned on each dollar of sales.
 
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