MINISTRY OF FINANCE ACADEMY OF FINANCE Topic: “Accounting for sales and business result in HINO MOTORS Vietnam, Ltd and suggestions for improvement” GRADUATION THESIS Major: English for Finance and Accounting Hanoi, Year 2012 Student: Hồ Thị Thùy Phương Class: CQ46/51.03 MINISTRY OF FINANCE ACADEMY OF FINANCE Topic: “Accounting for sales and business result in HINO MOTORS Vietnam, Ltd and suggestions for improvement” GRADUATION THESIS Major: English for Finance and Accounting Supervisor: MBA. Nguyễn Thị Thùy Trang Hanoi, Year 2012 Student: Hồ Thị Thùy Phương Class: CQ46/51.03 Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 DECLARATION I hereby declare that this thesis is my own work and effort and that has not been submitted anywhere for any award. Where other sources of information have been used, they have been acknowledged. The data and results described in the thesis are derived from the actual situation of the practice company. Hanoi, 30 April, 2012 Student Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 ACKNOWLEDGEMENT Firstly, I am deeply indebted to my supervisor MBA. Nguyen Thi Thuy Trang whose help, stimulating suggestions and encouragement helped me all the time of research for and writing of this thesis. I also want to thank Hino Motors Vietnam, Ltd for giving me permission to commence this thesis in the first instance, to do the necessary research work and to use departmental data. I have furthermore to thank the former Vice Director and Finance Manager as well as all seniors at Hino Motors Vietnam, Ltd who gave and confirmed this permission and encouraged me to go ahead with my thesis. My friends from Foreign Language Faculty also supported me in my thesis. I want to thank them for all their help, support, interest and valuable hints. Especially, I would like to give my special thanks to my family whose patient love enabled me to complete this work. Finally, because of limitation of time and knowledge, mistakes are unavoidable, so I wish to have more opportunities. I also wish to receive more contribution and suggestions to make my thesis better. Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 ABSTRACT In the modern economic world, especially when the number of bankrupt enterprises is rising, accounting for sales and business result has become more and more important, for every company in general, and for Hino Motors Vietnam, Ltd in particular. Therefore, my thesis with the topic “Accounting for sales and business result in Hino Motors Vietnam, Ltd and suggestions for improvement” will point out the importance of having a healthily and effective accounting department for sales and business result. The main content is reflected in three chapters. The first chapter is about the literature review for every company, mainly showing what accounts are involved in calculating business result, its definitions and accounting entries. In chapter 2, by taking a scenario in Hino Motors Vietnam, Ltd, the thesis focuses on a real accounting practice for sales and business result. From that, chapter 3 points out the company’s strengths and weaknesses and suggests some solutions to improve the current accounting system in Hino Motors Vietnam, Ltd. In conclusion, the thesis has already been complete in comparison with proposed objectives and targets in the introduction. Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 LIST OF ABBREVIATIONS No. Abbreviation Full phrase 1 Acc Account 2 COGS Cost of goods sold 3 Deprec Depreciation 4 Dept Department 5 HMV Hino Motors Vietnam 6 IS Income Statement 7 MKS Mankichi Kanjo System 8 No. Number 9 P&L Profit and Loss 10 Q’ty Quantity 11 VAS Vietnamese Accounting Standard 12 VAT Value Added Tax Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 TABLE OF CONTENT Part I: Introduction 1 1. Rationale 1 2. Aims of the study 1 3. Subject and scope of the study 2 4. Introduction of the main content 2 Part II: Main content 3 Chapter 1: Literature Review 3 1.1 Overview 3 1.1.1 Characteristics of goods 3 1.1.2 Managerial requirements 3 1.1.3 Funtions of accounting for sales and business result 4 1.1.4 Methods of sales 5 1.2 Accounting entries for sales and business result 6 1.2.1 Accounting for Cost of Goods Sold (COGS) 6 1.2.2 Accounting for Sales and Sales Deductions. 8 1.2.3 Accounting for Selling and Administration expenses 11 1.2.4 Accounting for Financial Expenses and Incomes 12 1.2.5 Accounting for Other Expenses and Incomes and Corporate Income Tax Expense. 13 1.2.6 Accounting for business result 14 1.3 Preparing financial statements 15 1.4 Systems of Accounting forms 15 1.5 Computerized accounting for sales and business result 17 Chapter 2: Current situation of accounting for sales and business result in HINO MOTORS Vietnam, Ltd 18 2.1. Overview about Hino Motors Vietnam, Ltd 18 2.1.1. History 18 2.1.2. Business field and products 18 2.1.3. Organizational structure. 19 Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 2.1.4. Characteristics of accounting department 19 2.2. Current situation of accounting for sales and business result in Hino Motors Vietnam, Ltd. 21 2.2.1. List of main products 21 2.2.2. Main selling method at Hino Motors Vietnam, Ltd 22 2.2.3 Current situation of accounting for sales and business result 23 2.2.3.1 Accounting for Cost of Goods Sold (COGS) 23 2.2.3.2 Accounting for Sales and Sales Deductions 26 2.2.3.3 Accounting for Selling and Administration Expenses 32 2.2.3.4 Accounting for Business result 36 2.2.3.5 Income Statement 38 2.3 General conclusion about accounting performance for sales and business result in Hino Motors Vietnam, Ltd 39 Chapter 3: Some suggestions for improving the accounting system for sales and business result in HINO MOTORS Vietnam, Ltd 40 3.1 Evaluation of accounting for sales and business result in Hino Motors Vietnam, Ltd 40 3.1.1 Strong points 40 3.1.2 Weaknesses 41 3.2 Importance and requirements for improving the accounting system for sales and business result. 42 3.2.1 Importance 42 3.2.2 Requirements 43 3.2.3 Orientation 43 3.4 Some suggestions for improving the accounting system for sales and business result in Hino Motors Vietnam, Ltd 45 3.3.1.Updating the accounting software 45 3.3.2 Allocating tasks effectively to accountants 45 3.3.3.Opening third-level accounts 46 3.3.4.Improving the Sales Discount accounts. 47 Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 3.3.5.Improving the preparation of accounting reports 47 Part III: Conclusion 51 References Appendixes Graduation thesis Hồ Thị Thùy Phương – CQ46/51.03 Page 1 Part I: Introduction 1. Rationale In this modern economic world with many newly established enterprises which follows a more competitive economic environment, every company must be flexible and active in their businesses, make as many profits as possible; else they will fall into bankruptcy. In order to gain profits, they must realize the importance of sales and distribution phase because of its creating incomes to offset incurred expenses, then determining the profitability of the company. Besides, the very first objective of every enterprise is making a profit, so calculating business result in general and sales revenue in particular is very important in both forms of accuracy and timeliness. It’s the reason why efficient and effective accounting management for sales and business result plays an important role in the accounting system. Hino Motors Vietnam, Ltd is a manufacturer of heavy and medium – sized trucks. This field is rather new in Vietnam with competitive markets. It is now one of leading companies in this field. Therefore, maintaining its current position and being the market leader is more important than ever. From this situation, Hino Motors Vietnam, Ltd must have a flexible and effective sales campaign with a well-performed accounting system for sales and business result. Because of the importance of accounting for sales and business result, I chose “Accounting for sales and business result in HINO MOTORS Vietnam, Ltd and suggestions for improvement” as my graduation thesis topic. 2. Aims of the study My study has three objectives: First, it is to contribute to the background theory of accounting for sales and business result, which is done by pointing out definitions, accounts used and accounting entries for each account related to determining business result in a manufacturing company. [...]... Long Engineering And 7 8 Auto Joint Stock Company – Auto Joint Stock Company – Can Tho Branch 6 Truong Long Engineering And Can Tho Branch Long An Minh Man Hino Motors, Ltd Minh Man Hino Motors, Ltd Ba Ria - Vung Truong Vinh HINO Motors, Truong Vinh HINO Motors, Tau Ltd Ltd Can Tho 9 10 Buon Ma Thuot 11 Ca Mau 12 Truong Vinh HINO Motors, Tien Giang Binh Dinh Ltd – Tien Giang Branch Thai Hoa Co., Ltd Thai... Hino Motors Vietnam, Ltd 4 Introduction of the main content Apart from the introduction, conclusion, references and documents attached, the main content is divided into three chapters as follows: Chapter 1: Literature Review Chapter 2: Current situation of accounting for sales and business result in HINO MOTORS Vietnam, Ltd Chapter 3: Some suggestions for improving the accounting system for sales and. .. does accounting for sales and business result by taking the scenario at Hino Motors Vietnam, Ltd as a case for study Third, it is to review the company’s achievements and limitations and to suggest possible solutions to improve the accounting performance for sales and business result in the future 3 Subjects and scope of the study 3.1 Subjects of the study My study mainly focuses on sales, selling expenses,... calculating and reporting results of each transaction; - Monitoring the implementation of state obligations and division process of business result; Hồ Thị Thùy Phương – CQ46/51.03 Page 4 Graduation thesis - Interpreting accounting reports to information users Accounting information must be accurate, easy-to-read and useful Therefore, accounting for sales and business result must follow current regulated accounting. .. current income tax to determine operation result 1.2.5.3.2 Accounts used - 821 – Corporate income tax expense 1.2.6 Accounting for Business result 1.2.6.1 Definition Business result is the final result of the normal activities and other activities during the accounting period Business result in a certain period may be profit or loss In case of loss, business result will be compensated as regulated and. .. high speed, diversity and wellperformance Applying computerized accounting system create a certain belief in the certainty and unique differences for business activities Therefore, at the moment, most of all enterprises are using computerized accounting For accounting for sales and business result, applying suitable accounting software is very important because it will bring following benefits if applied... ledger book for accounts 511, 632, 641, 642… 2.1.4.7 System of accounting reports - Balance sheet (Form B01 – DN) - Income Statement (Form B02 – DN) - Cash Flow Statement (Form B03 – DN) - Notes to Financial Statements (Form B09 – DN) 2.2 Current situation of accounting for sales and business result in HINO MOTORS Vietnam, Ltd 2.2.1 List of main products Hino Motors Vietnam, Ltd is an independent legal... day Therefore, in order to be well managed, the company must have a single department to record, track, and report all of the sale transactions daily From these requirements, accounting for sales and business result is established 1.1.3 Functions of accounting for sales and business result In order for requirements of managing goods, sales, determination of business result and division of net income... following is the contact details of Hino Motors Vietnam, Ltd: Hino Motors Vietnam, Ltd Headquarters: Hoang Liet, Hoang Mai District, Hanoi Tel: +84-4-3-8616017 Fax: +84-4-3-8616018 Website: http://xetaihino.vn/ 2.1.2 Business Field and Products Hino Motors Vietnam, Ltd s is in manufacturing business field and produces medium and large-sized trucks Up to now, it is a leading truck manufacturer in Vietnam... white, orange, blue, 5,180 Hino 300 Series Hino Bus gray Red, white, orange, blue, gray White, red, orange 2.2.2 Main selling method at HINO MOTORS Vietnam, Ltd The main selling method at HMV is sales through agents, not direct sales Therefore, operating expenses include selling expenses, administrative expenses Hino Motors Vietnam, Ltd has a wide range of agents and after sales service providers all . accounting for sales and business result in HINO MOTORS Vietnam, Ltd Chapter 3: Some suggestions for improving the accounting system for sales and business result in HINO MOTORS Vietnam, Ltd. Some suggestions for improving the accounting system for sales and business result in HINO MOTORS Vietnam, Ltd 40 3.1 Evaluation of accounting for sales and business result in Hino Motors Vietnam,. general, and for Hino Motors Vietnam, Ltd in particular. Therefore, my thesis with the topic Accounting for sales and business result in Hino Motors Vietnam, Ltd and suggestions for improvement