Oxford College for PhD Studies Alternative Educational Research Structure to the UNESCO System, Third Level Research and Scientific Body “Oxford Research” Third Level Research and Scientific Body

Accountancy

Accounting is a core business discipline, the study of which offers a wide choice of careers and provides an excellent base for progression throughout your career. You will be introduced to two core subject areas in the first and second year of your degree:

Financial Accounting – recording the financial activities of business organisations and reporting on their performance to those with an interest, for example, shareholders, lenders, suppliers, customers, or the government.

Management Accounting – the use of financial information within business organisations in order to measure performance, control day-to-day activities, and plan for the future.

Accountancy combines the expertise of staff who specialise in Finance, Economics, Management Studies and Information Technology to produce a qualification, which is both of a high standard and applicable to the business environment.

STUDYING ACCOUNTING

All courses are modularised and carry a number of credits. Credits are gained through a weighted combination of course work and examinations. The following degree programmes can be taken:

3 year designated degree in Accounting, MA (Accounting)

4 year Honours degree in Accounting, MA Accounting

Joint Honours in Accounting and another subject. Options include Economics, Finance, Management Studies, Property or Languages, as well as many others.

Accounting & Investment Research

Evaluating Business Investments

Evaluating world food necessity and investment

Food shortages worldwide and Financial Markets

Businesses often face the need to spend large amounts of money on assets that will be functional for many years. Here are a few examples:

Equipment to improve an unsafe work situation or to protect the environment

Equipment to test the consistency of products as required by the customer
Equipment to package, label, and ship products according to the customer's specifications
Equipment to reduce labor costs and improve the quality of products
Capital Budgeting
Capital Budgeting Models
Evaluating Capital Expenditures

Capital Budgeting

Limitations such as time, money, and logistics frequently prevent a company from moving forward with too many major expenditure projects at the same time. Instead, a company will often rank its projects by priority and profitability. By using a process called capital budgeting, the company decides which capital expenditure projects will be undertaken and when.

At the top of the list of capital expenditure projects are those for which no real choice exists (e.g., installing an updated sewer line within the plant to replace one that is leaking, correcting a safety hazard, correcting a code violation, etc). The remaining capital expenditures are usually ranked according to their profitability using a capital budgeting model.

Capital Budgeting Models

There are a number of capital budgeting models available that assess and rank capital expenditure proposals. Let's take a look at four of the most common models for evaluating business investments:

Accounting rate of return
Payback
Net present value
Internal rate of return

While each of these models has its benefits and drawbacks, sophisticated financial managers prefer the net present value and the internal rate of return methods. There are two reasons why these models are favored: (a) all of the cash flows over the entire length of the project are considered, and (b) the future cash flows are discounted to reflect the time value of money.

Evaluating Capital Expenditures

Let's use the capital budgeting models to evaluate a potential business investment at Treeline Manufacturing, Inc.:

Treeline Manufacturing must decide whether or not it should buy a new machine to replace its existing machine. Because the new machine is faster, it would eliminate the need for a worker now employed to run the existing machine during the evening shift. The initial annual savings are expected to be $24,000, with future cost savings expected to increase $1,000 or more per year.
The old machine is fully depreciated and would be scrapped with no expected salvage value (no proceeds).
The new machine costs $100,000 and is expected to have no salvage value at the end of its useful life of 8 years. For purposes of financial reporting, the machine would be depreciated over its 8-year life using the straight-line method. For income tax reporting, it would be depreciated over 7 years using the accelerated method. The company's income tax rate (federal and state combined) is 30%.
The new machine would be placed into service on January 1 and a full year of depreciation expense would be recorded on the financial statements during the first year. For income tax purposes our analyses uses a half-year of depreciation during the first year.