The Public Losing Confidence in Capitalism Samples for Student

Question: What Is the Value of Public Losing Confidence in Capitalism? Answer: Introducation: Public Losing Confidence in Capitalism The current study is on the lookout to explain the theories that are pertinent to the document published in The Australian Financial Review with respect to the Public Losing Confidence in Capitalism. The Chairperson of Orica Mr Malcolm Broomhead revealed his sentiments regarding the factor that human beings are mislaying their confidence over capitalism. The document with respect to the positivism theory has discovered that common people has reduced their trust on the system of capitalism due to their fact that capitalism has an objective of increasing the profit of an organization themselves and neglecting the interests of the community and the individuals(Financial Review 2017). With regards to the positivism theory, the system of capitalism has expanded in their importance due to ineffective control on the rate of exchange and the government focusing more on the taxation polices over the monetary policies that limits the capitalist process to exploit their supremacy. It is seen that these were the some of the major causes that created financial catastrophes that predisposed the common man to reduce their confidence over capitalism. Malcolm gave the evidence that the effect of United States of America electing Mr Donald Trump as their President and the elected voters of United Kingdom decided to exit the BREXIT discovers the elimination of trust over capitalism by the common people and in relation to the normative theory, people are under the expectation that these transformations can enhance their living standards and their regimes(Kroker and Weinstein 2015). It is observed that capitalist system gradually started to reduce the confidence of the public since the effect of the financial disaster that occurred globally in 2008. The impact of financial crisis and common people losing expectations was due to the theory of positivism. The ineffectual policies of the government regarding the rate of interest, rate of exchange, policies of trade and the different other disparaging controls were few of the important causes that was the main result of financial disaster(Mackey and Sisodia 2014).. The ineffectiveness of the government and the activities of the business that is regarded as the positivism economic theory had demotivated the individuals and thus the lay man made the decision to move away from the globalized business process and the bodies of the government to a simpler world. The normative theory describes there is a requirement for changes in the functions of the operations of the business that functions in the economy so that the faith of capitalist system can be regained from the perspectives of the public, which should be part of the answer and not the factor behind their problems. The theory of positivism describes that inadequacy in the efficiency of the policies of the government and inaccurate business plans is the main reason for the increase in inflation and immobility in the economy(Zingales 2014). The deficits of the government that were not anticipated and the increase in the trade gap were the significant symbols that discovered the expiration of the capitalist economy. The awareness among the individuals regarding the conditions of the economy was increasing slowly as the standard of living and the income of the people were falling slowly. It is even seen that the price of the commodities were rising in bounds and leaps but the consumers income were falling. Mr Malcolm with regards to the normative theory made a distinctive statement that it is significant to recuperate the faith of the common people by making them conscious about the fact that wealth distribution is impossible without wealth creation(Streeck 2014). The other factor that was highlighted with regards to the loss of confidence over capitalism was the multifaceted structure of the organizations. The vital objective of the individuals who are investing in an organizations is to earn revenue. Conversely, the composite configuration of the incentives of the employees had an effect on the incomprehensible causes and therefore, it was not an inspiration for the internal and external stakeholders and the employees of the firms(Beckert 2013). It is observed that the reports about incentives are extremely problematic to realize and the conclusive end-result of their remunerations still remains unknown till the concluding day. Mr Malcolm had an impression of altering the structure of incentives in the firms and raising the total number of shareholders by allocating shares to the internal employees so that an improved incentive can be created and establishing procedures that are controllable among the employees. Thus, it is observed that the evaluation is on the basis of normative and positivism theories and the document discovers that the most significant cause for the loss of confidence among the people on capitalism is mainly due to the government regulations that are unproductiveand the multifaceted structure of compensation of the capitalist business. The management is in the impression of creating profit but are worried about the wellbeing of the community. With the help of this document, Mr Malcolm tried to suggest all the firms and the government that are operating in the market to influence and motivate individuals about the significance of growing wealth will lead to the circulation of wealth in the economy leading to the increase in the standard of living of the individuals. It is even suggested that the firms start changing their structure of the business and the recommend the governments to change their regulations to bring out a optimistic appearance about capitalism within the public. The documents reveals that Mr Malcolm has associated the normative and the positivism theories with the document to create the document more understandable and specific to the readers. In the Books of Elk Ltd. Journal Entries Date Particulars Amount Amount 31/08/2019 Bank A/c Dr. (340000x0.50) 170000 To, Share Application A/c 170000 (Being Applications for shares received for 340,000 shares at $0.50 per share) 31/08/2019 Share Application A/c Dr 170000 To, Equity Share Capital A/c (300000*0.50) 150000 To, Share Allotment A/c (40000*0.50) 20000 (Being share application for 300000 shares transferred to the share capital and the rest 40000 shares transferred to allotment ) 01-09-2019 Share Allotment A/c Dr. (300000*1) 300000 To, Equity Share Capital A/c 300000 (Allotment of 300,000 shares) (Being share allotment due for 300000 shares @ $1 ) 30-09-2019 Bank A/c Dr. 280000 To, Share Allotment A/c 280000 (Being share allotted on 280,000 shares @ $1) 01-12-2019 Share First Call A/c Dr. (300000*0.50) 150000 To, Equity Share capital A/c 150000 (Being share first call due on 300000 shares @ $0.50) 31-12-2019 Bank A/c Dr. (280000*0.50) 140000 To, Share First Call A/c 140000 (Being share call received on 280000 shares @ $0.50 and 20000 shares failed to pay) 15-01-2020 Equity Share Capital A/c Dr. (20000*2) 40000 To, Share First Call A/c (20000*0.50) 10000 To Share Forfeiture A/c (20000*0.50) 10000 (Being 20000 shares forfeited on the non-payment of the call) 15-02-2020 Bank A/c Dr. (20000*1.70) 34000 Share Forfeiture A/c (20000*0.30) 6000 To Equity Share Capital A/c (20000*2) 40000 (Being 20000 shares reissued @ $1.70 per share) 15-02-2020 Cost of Re-Issue A/c Dr. 8000 To, Bank A/c 8000 (Expenses of reissue paid) 15-02-2020 Share Forfeiture A/c Dr. 4000 To, Bank A/c 4000 (Surplus returned to the original shareholders) Particulars: Carrying Amount Fair Value Impairment Proportion Land 150000 150000 40.54% Buildings 280000 Less: Depreciation 120000 160000 160000 43.24% Inventory 60000 60000 16.22% Total 370000 370000 1 Particulars Carrying Amount Fair Value Impairment Value Goodwill 12000 0 12000 Machinery 140000 Less: Depreciation 60000 80000 75000 5000 Particulars Carrying Amount Fair Value Impairment Proportion Land 150000 150000 40.54% Buildings 280000 Less: Depreciation 120000 160000 160000 43.24% Inventory 60000 60000 16.22% Total 370000 370000 1 Particulars Carrying Amount Fair Value Impairment Value Goodwill 12000 0 12000 Machinery 140000 Less: Depreciation 60000 80000 75000 5000 Dr. Cr. Date Particulars Amount Amount 30/06/20X4 Impairment Loss A/c. 142000 Goodwill A/c. 12000 Machinery A/c. 5000 Land A/c. 50676 Building A/c. 54054 Inventory A/c. 20270 Reference Beckert, J., 2013. Capitalism as a system of expectations: Toward a sociological microfoundation of political economy. Politics Society, 41(3), pp.323-350. Du, K., Givoly, D. and Alhusaini, B., 2017. The Impact of the Codification of Accounting Standards on Compliance and Reporting Costs, and its Usefulness for Empirical Research. Financial Review. (2017).Orica chair Malcolm Broomhead says confidence in capitalism is waning. [online] Available at: https://www.afr.com/business/mining/orica-chair-malcolm-broomhead-says-confidence-in-capitalism-is-waning-20161215-gtbr5n [Accessed 31 Mar. 2017]. Kroker, A. and Weinstein, M.A., 2015. The political economy of virtual reality: pan-capitalism. CTheory, pp.3-15. Mackey, J. and Sisodia, R., 2014. Conscious capitalism, with a new preface by the authors: Liberating the heroic spirit of business. Harvard Business Review Press. Radebaugh, L.H., 2014. Environmental factors influencing the development of accounting objectives, standards and practices in Peru. The international Journal of Accounting Education and Research. Urbana, 11(1), pp.39-56. Streeck, W., 2014. Buying time: The delayed crisis of democratic capitalism. Verso Books. Zingales, L., 2014. A capitalism for the people: Recapturing the lost genius of American prosperity. Basic books.