Ethical Code in cost & Management Accounting
CIMA has provided the following as elements of code of conduct to be followed by cost and management accounts. Define and explain them in relation to cost and Management Accounting
- Confidentiality
- Integrity
- Objective or Credibility
- Professional Competence and due care
- Professional behavior
Financial Acc.
Exercise
Wori corp maintains its financial recorders on the cash bases of accounting interested in securing a long term loan from its regular bank, wori corp. Requests you as its independent CPA to convert its cash-basis income statement data to the accrual basis you are provided with the following summarized data covering 2003,2004,abd2005
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2003
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2004
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2005
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Cash receipts from sales:
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On 2003 sales
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$295,000
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$160,000
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$30,000
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On 2004 sales
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-0-
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355,000
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90,000
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On 2005 sales
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|
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408,000
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|
|
2003
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2004
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2005
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|
Cash Payment for expense:
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On 2003 expenses
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185,000
|
67,000
|
25,000
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On 2004 expenses
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40,000a
|
160,000
|
55,000
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On 2005 expenses
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45,000b
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218,000
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a= prepayments of 2004 expenses
b= prepayments of 2005 expenses
Instructions
a) Using the data above, prepare abbreviated income statements for the years 2003 and 2004 on the cash basis.
b) Using the data above, prepare abbreviated income statements for the years 2003 and 2004 on the accrual basis.