ACC 201 Final Project Part II Bank Memo
Southern New Hampshire University
Professor George Angus
To: The Bank Loan Manager
From: The CFO/Managing Director of Peyton Approved
Date: April 3, 2016
Subject: Peyton Approved Business Expansion Loan Request
Peyton Approved is a business that manufactures and distributes organic all-natural and hypo-allergenic baked treats for dogs. The company named after our dog (Peyton), was an idea that started at home after realizing the severity of his allergies from the products bought at the store; and what could be done to make all natural products that would not cause any more harm. What started as a home-based idea soon turned into a ...view middle of the document...
This method we believe allows us to see our profits, resources, debts and other information that will give us a more realistic view on where we stand as a company. match the economic reality.
Accounting Process and Internal Controls for Cash
In order to ensure responsible accounting practices Peyton Approved will be investing in QuickBooks Pro; this accounting software will allow us to make sure all the steps are being followed correctly. We have also hired Fusion Group; Fusion Group is an accounting firm that specializes in new business owners to help with the accounting process. As a company we are also taking classes to get a better understanding of accounting, getting an understanding of why the accounting cycle is important, what the numbers mean for the company, whether or not we are in debt, we owe money, but also being able to get a true sense of the monthly profit (Scheid, J., (2011).
Peyton Approved accounting cycle comprises of the following steps– transactions, journal entries, posting, trial balance and worksheet, adjusting journal entries, financial statements and closing of the books (Tarver, E, 2106). As a new company up and coming we have to make sure our payables, receivables, bank recs and all sales have been noted. Also making sure that wages or expenses that are accrued are recorded. We have found that these steps are instrumental as a company when it’s time to prepare our quarterly financial statements.
There are internal controls for cash that are in place for Peyton Approved; we do not have the same person handling cash; receiving and depositing cash, making payments, and recording the payments or accounts receivable. This practice ensures that not too many employees are exposed to the cash, and any potential discrepancies will be immediately recognized.
Results of Operations and Strengths and Weaknesses of the Company
Peyton Approved will perform analyses of its operations result, with this analysis we will get verifiable data about variances that may occur monthly. We will be able to get an overall plan on how and where additional funding can be required, and how we can lower our operational costs. This analysis will give us and idea of the income and expenses for the foreseen future, and will allow and give the company more time to react to problems arising from incorrect data or opportunities that may present itself. These results will tell us whether or not the company will survive, how financially stable it will be, and how to continuously bring in revenues. Based on the financial statements as a company we are headed in the right direction, but as a small new business our wages expenses will need to be monitored carefully as it was...