Financial & Managerial Accounting

Question: Discuss about the Financial Managerial Accounting. Answer: Introduction:- Financial performance forms the basis for growth of any business as the continuity of operations of any business is ensured by them. Hence, it is essential for any organization to evaluate its financial performance over the periods that is it can be either annually, quarterly or monthly. Financial analysis and evaluation are provided by most of the advanced accounting software. Such financial reports with every entry of financial transactions are updated and prepared with the help of Saasu (Bourne et al., 2015). Moreover, it is possible to obtain many other report required for performance measurement in an effective manner using this software. The report discusses about the Streamline financial performance based on its financial report. Report is prepare under using Saasu software. It also provides the recommendation for improving financial performance and evaluation process of Streamline. Financial performance analysis: There are various forms that can be used to evaluate the financial performance of Streamline. Profit or gain is regarded as the most important aspect for profit making entity (Warren et al., 2013). This is depicted by profitability ratio and therefore, the profitability ratio for Streamline is calculated in the table below: Profitability Ratios:- Particulars Amount Total Revenue $41,061.10 Gross Profit $18,212.10 Net Profit $7,487.10 Owner's Contribution $60,000.00 Gross Profit Margin 44.35% Net Profit Margin 18.23% Return on Equity 12.48% Performance of Streamline is quite good as depicted from table above. 44.35% of sales revenue of organization has been converted into gross profit and has returned a net profit of 18.23%. Return on equity stands at 12.48% on the initial contribution and hence performance can be regarded at par (Weygandt et al., 2015). Some other ratios that can be used to measure the efficiency of operation level of Streamline are as follows: Efficiency Ratios:- Particulars Amount Total Revenue $41,061.10 Accounts Receivable $15,908.75 Cost of Sales $22,849.00 Inventory $8,591.00 Accounts Payable $26,400.00 Accounts Receivable Turnover Period 141.42 Inventory Turnover Period 137.24 Accounts Payable Turnover Period 306.49 The average period of paying off credit purchases and collecting credit sales stands at 306.49 and 141.42 respectively, although the credit period for account payable and receivable are 30 days after month end purchase and 30 days after sales. It takes 137.24 days for converting the inventories into sales. Strategies taken for operations improvement: It is clearly depicted from above figures that satisfactory profit margin has been generated by Streamline. Organization can improve its level of efficiency and profit margin by adopting flowing strategies: Fixed assets of company should be charged with depreciation as it would help in accumulating replacement cost of fixed assets. Viewing the present turnover, it is recommended to convert its inventories quickly into sold products. For reducing bad debt risk, organization should maintain bad debt provisions. Cash inflow of Streamline can be increased by reducing the accounts receivable turnover period (Hossack, 2015). Conclusion: The financial performance of Streamline has been evaluated using the financial report. For effective business decision making, organization has Saasu software, which provides additional reporting facilities. Streamline can utilize additional benefits of its employed software, which is used for recording the financial transactions. Following report can be useful for Streamline. Forecasted cash flow- This would help in determining cash flow expense and cash revenue and forecasting would help in accordingly taking business decision. BAS Summary- This helps in effectively computing expenses concerning tax based on business financial activities. Reference: Bourne, S., Szabo, C., Sheng, Q. Z. (2015, June). Managing Configurable Business Process as a Service to Satisfy Client Transactional Requirements. InServices Computing (SCC), 2015 IEEE International Conference on(pp. 154-161). IEEE. Hossack, S. (2015). Cloud-based accounting and productivity tools for practitioners and taxpayers.Taxation in Australia,50(5), 265. Warren, C. S., Reeve, J. M., Duchac, J. (2013).Financial managerial accounting. Cengage Learning. Weygandt, J. J., Kimmel, P. D., Kieso, D. E. (2015).Financial Managerial Accounting. John Wiley Sons.