Due 21721 For This Assignment: You Will Be Making Adjustment

Due 21721for This Assignment You Will Be Making Adjustments To The F

For this assignment, you will be making adjustments to the financial statements based on new transactions and describing various financial reports. Refer to the Excel spreadsheet, "Company Overview Template," for the instructions and details to complete this assignment. While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center.

Paper For Above instruction

Financial statement adjustments are a crucial aspect of accurate financial reporting, ensuring that a company's financial statements reflect all relevant transactions within a given period. In this paper, I will demonstrate the process of making corrections to financial statements by analyzing new transactions and revising previous entries accordingly. This process involves careful review and understanding of the financial data, adjustments to accounts such as revenues, expenses, assets, liabilities, and equity, and understanding how these changes affect the overall financial health of the company.

The primary source used in this analysis is the "Company Overview Template," an Excel-based document providing the necessary financial data and transaction details. This template serves as the foundation for revising the company's financial statements, including the income statement, balance sheet, and statement of cash flows. Making these adjustments correctly requires a thorough understanding of accounting principles, such as accrual accounting, matching principle, and revenue recognition.

First, I will review the new transactions to identify which accounts are impacted. For example, a new sale might increase revenue and accounts receivable, while a new expense, such as utility costs, will increase expenses and decrease cash or accounts payable. Recognizing these impacts is essential for maintaining consistency and accuracy in financial reporting. By adjusting the accounts accordingly, the financial statements will better depict the company's financial position.

Next, I will explain how these adjustments influence the financial reports. For instance, increasing revenue without recording associated expenses would overstimulate profitability, misleading stakeholders. Proper adjustments ensure the income statement accurately reflects ongoing operations, while the balance sheet shows an authentic snapshot of assets, liabilities, and equity.

Furthermore, I will describe the importance of adjusting entries for accruals and deferrals. Accruals provide for expenses incurred or revenues earned but not yet recorded, ensuring the financial statements abide by the matching principle (Berk, DeMarzo, & Harford, 2020). Deferrals, on the other hand, postpone the recognition of revenues or expenses until a future period. Correct handling of these entries is vital for true financial representation and compliance with accounting standards such as GAAP.

Finally, I will reflect on how timely and accurate adjustments contribute to better decision-making by management and investors. Proper adjustments foster transparency, foster trust, and support strategic planning. Accurate financial reports guide resource allocation, investment decisions, and credit assessments, ultimately impacting the company's growth and stability (Young & Goodwin, 2019).

References

• Berk, J., DeMarzo, P., & Harford, J. (2020). Fundamentals of Corporate Finance (6th ed.). Pearson.
• Gibson, C. H. (2019). Financial Reporting & Analysis (14th ed.). Cengage Learning.
• Healy, P. M., & Palepu, K. G. (2019). Business Analysis & Valuation: Using Financial Statements (6th ed.). Cengage Learning.
• Higgins, R. C. (2021). Analysis for Financial Management (12th ed.). McGraw-Hill Education.
• Palepu, K. G., & Healy, P. M. (2018). Business Analysis and Valuation: Using Financial Statements (3rd ed.). Cengage Learning.
• Schroeder, R. G., Clark, M. W., & Cathey, J. M. (2020). Financial Accounting Theory (14th ed.). Wiley.
• Stickney, C. P., Brown, P., & Wahlen, J. M. (2019). Financial Reporting, Financial Statement Analysis, and Valuation (10th ed.). Cengage Learning.
• Young, S., & Goodwin, J. (2019). Financial Accounting. McGraw-Hill Education.
• Wahlen, J. M., Baginski, S. P., & Bradshaw, M. (2020). Financial Reporting, Financial Statement Analysis, & Valuation (9th ed.). Cengage Learning.
• Zeghal, D., & Miah, M. (2020). Accounting and Financial Statement Analysis. Routledge.