Varga Case Study
Varga's (2011) study found the following:
The use of market values does not acknowledge the relationship of depreciation as an operating expense of the business, and makes assumptions about the asset that may or may not include “transactions and activities” or “events that happen to it” as well as include assumptions about external demand for the asset and economic, governmental, or social factors that may not be relevant to the particular asset while employed by an entity.
As seen above all accounts for the blue print of a business describes assets and liabilities. The assets can be broken down into even smaller categories payroll, tips, petty cash, savings and general income can all be under cash assets. Inventory can be broken down into furniture, linen, supplies,
and …show more content…
I would make sure the rent/mortgage is always paid first. An entrepreneur cannot have a business and not have a place for the customers to get their hair cut. Considering the weight of the two internal controls I think this will balance out my business’s finances to provide assurance to growth for my business. Research by Sanyal and Mann supports… “Consistent with other research, startups owned by African-American entrepreneurs have a lower probability of having any type of external finance, especially external equity, and instead finance their firms through personal resources” (Sanyal and Mann). Being an entrepreneur is difficult already being that I am an African-American I will make sure I have everything in order to safeguard my …show more content…
Comply with the requirements and the GAAP procedures well impact the success of my business. According to Grinberg (2007), “Since small companies don’t have many controls in place, they are being forced to spend a lot of money on creating and implementing internal controls” (p. 12). Because the company is smaller the auditors are trying to make sure entrepreneurs have their business in order before continuing business. All businesses must comply with the Sarbanes-Oxley Act no matter how big or small. This act is in place to regulate the financial practices of all business. My business complies with The Sarbanes-Oxley Act at all times because we make sure our report do not contain any falsified information. All financial statements are recorded and audited on monthly bases. I like to make sure we stay organized as a company and hopefully we will be able to grow into a larger barber