This Accounting category will cover various topics on accounting ranging from financial, management, and advance accounting.
Average total assets show the operating efficiency of a business and can be used to compare net income in terms of assets. It is a commonly used financial metric with a few simple steps to calculate the figure. However, it does come with some limitations as it uses historical data. Let’s dive into the details …
Accounting can be defined in terms of activity performed by an accountant. It has several types or branches based on activities or classes. Let’s discuss the top 12 accounting branches and their main characteristics. What are the Accounting Branches and What Do They Offer? Accounting branches are types of accounting practices to record, measure, and …
Unearned revenue or deferred revenue is a form of advance payment received by a seller against a performance promise to the buyer. It is recorded as soon as the transaction takes place and recognized as a current liability on the balance sheet of the seller. What is Unearned Revenue? Unearned revenue refers to income received …
What is Unearned Revenue? Is It an Asset or Liability? Read More »
A chartered accountant (CA) has several career options as it is a highly regarded professional degree. You can become a CA by completing the required educational and work hours and passing the exam. Let’s discuss what career options chartered accountants have and do they remain unemployed. What is a Chartered Accountant (CA)? A Chartered Accountant …
How to Become a Chartered Accountant? – Do Chartered Accountants Remain Unemployed? Read More »
Accounts receivable aging report is an informative document for a business showing details about the receivables schedule from different clients. Let’s discuss how to calculate accounts receivable aging and how this report can help a business in different types of analysis. What is Accounts Receivable Aging? Accounts receivable aging refers to the time taken to …
What is Accounts Receivable Aging? How to Calculate Accounts Receivable Aging? Read More »
Horizontal or trend analysis is the historic review of the financial statements of a company for a specified period. Let us discuss what is horizontal analysis, how to perform it, and what are its advantages for the users. Horizontal Analysis – Definition Horizontal analysis refers to the historical comparison of financial statement items from one …
What is Horizontal Analysis of Financial Statements? Read More »
The vertical analysis provides a correlation between one line item in a financial statement and its top-line or baseline item. It is calculated by adding a column in the financial statement and the results are shown in percentage terms. It offers valuable information to internal and external stakeholders and can be used in different situations. …
What is Vertical Analysis of Financial Statements? Read More »
Debt financing fee is amortized over the life of the debt under the GAAP rules. The borrower incurs different types of debt issuing or financing costs. Let us discuss what are financing costs and how they should be amortized over the period of the debt instrument. What are Financing Costs? Financing costs refer to the …
A temporary account provides an accumulated balance of a specific account type for one accounting period only. It starts and ends with a zero balance for each accounting period. Let us discuss what is a temporary account, its different types, and its key differences from a permanent account. What is a Temporary Account? A temporary …
A permanent account is an ongoing source of information for an entity. It reflects the carrying balance of a particular account on the balance sheet of an entity at any time. Once created, a permanent account is maintained throughout the life of a business. Its current balance is reconciled periodically to reflect the accumulated balances …
