This Accounting category will cover various topics on accounting ranging from financial, management, and advance accounting.
At the point of running an organization, it is essential to see how productive it is. Numerous managers consider the net revenue that processes the total sum by which income from sales surpasses expenses. However, in case you need to know how a particular item adds to the organization’s benefit, you have to consider the […]
How to Calculate Contribution Margin and its Ratio? Read More »
The defensive Interval period or ratio is a liquidity measure of a business. It gives the idea of business’s ability to meet its operational expenses utilizing current assets. It offers insights on a business’s ability to meet the current expenses without the need for liquidation of long-term assets. What is Defensive Interval Ratio? The Defensive
Defensive Interval Ratio: Definition and How to Calculate? Read More »
There are different categories that companies can use to classify their costs. One such categorization is direct and indirect costs. Direct costs refer to all the costs that a company incurs related to producing a product, whether a good or service. These costs mostly include material and labour costs such as raw materials, salaries and
Absorption of Overheads in Cost Accounting: Definition, Types, And Example Read More »
The main source of finance for companies, especially small-size companies and startups, is equity finance. Equity finance consists of finance that companies raise through their shareholders. In exchange for the finance they provide, shareholders receive the shares of the company. The shares of a company give its shareholders the ownership of the company for the
Accounting for Dividend: How to Record in Financial Statements Read More »
The book value or carrying of an asset defines its cost less any accumulated depreciation over its life. Sometimes, if a company choose to use the fair value method of valuing its assets, their book value will represent the revalued cost of the assets less any accumulated depreciation. Apart from accumulated depreciation, the carrying value
Accounting for Deferred Tax: Everything You Should Know About! Read More »
When it comes to bank transactions, two documents can confirm the bank balance of a company. This first document, or rather a ledger, is the bank book of the company. The bank is an internally prepared document that shows the company’s side of transactions. The company carries over the balance from its bank book to
How to Prepare Bank Reconciliation? A Step-by-Step Guide Read More »
The margin of safety calculation takes the break-even analysis one step further in the cost volume profit analysis. It is the difference between the actual activity level and the break-even activity level. We can calculate the margin of safety for sales, revenue, or in profit terms. It can be expressed in units, dollars, or in
How to Calculate Margin of Safety? Read More »
The Depletion method of depreciation is a cost allocation method that works for depleting natural resources. The accounting working for depletion works similarly as in depreciation of tangible assets or amortization with intangible assets. As the natural resources or assets “deplete” with extraction over time, the term is used as a depletion method of depreciation.
Depletion Method of Depreciation Read More »
In factories, industries, and big corporations the accurate estimation of production cost is a significant chapter. Large quantities of homogenous objects are often being produced in the industrial sector on regular basis. During the manufacturing process evaluation of direct and indirect costs is an important segment. To efficiently calculate the cost of the total production
What is Process Costing? All You Should Know! Read More »
In the property investment or during the company’s operating expenses the measurement and estimation of cost is the foremost priority of a capitalist. The purchase plan of properties requires good financial analysis. To measure these expenses an effective approach is used which is known as the operating expense ratio. In this article, you will get
How to Calculate Operating Expense Ratio? Read More »
