This Accounting category will cover various topics on accounting ranging from financial, management, and advance accounting.

Four Methods of Inventory Costing

In the previous articles, we have talked about inventory as well as methods in valuing inventory. In this article, we will talk about the inventory costing. So what are the costing methods of inventory? Inventory costing is very crucial; especially for merchandising company as we need to present in the financial statements both in statement […]

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What is inventory?

Inventory is an item presented in the financial statements as current assets. It is normally applicable for trading or merchandising as well as production company as they need to buy produce product or goods for resale. So what is inventory? Definition of Inventory There are a number of definitions; however, as per IAS 2, Inventory

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What is Going Concern Principle?

Introduction Basically, the purpose of setting up a business is to earn a profit, and all stakeholders want to see the business grow for the foreseeable future. They don’t want to see that company encounter any problems or failure that result in liquidation or bankruptcy. Thus, the going concern principle is always a key that

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What is Account Receivable?

In the statement of financial position, there are three main elements such as assets, liabilities and equity. Assets contain two main elements; current assets and non-current assets. Account Receivable is one of the items under current assets. So what is Account Receivable? Definition of Account Receivable Account Receivable is also commonly known as trade receivable

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What is Conservatism Concept?

Introduction Conservatism concept is one of the accounting concept dealing with the recognition of increase or decrease in equity. Normally, the increase of equity derives from the sale of goods or the provision of services to customers while the decrease of equity derives from the expenses incur at each reporting period. So what is conservatism

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What are liabilities in the statement of financial position?

[et_pb_section fb_built=”1″ _builder_version=”3.22″ custom_padding=”10px||13px|||”][et_pb_row _builder_version=”3.25″ background_size=”initial” background_position=”top_left” background_repeat=”repeat” custom_padding=”9px||14px|||”][et_pb_column type=”4_4″ _builder_version=”3.25″ custom_padding=”|||” custom_padding__hover=”|||”][et_pb_text _builder_version=”3.27.4″ background_size=”initial” background_position=”top_left” background_repeat=”repeat”] Liability is one main element in the financial statements presented in the statement of financial position or balance sheet. Liabilities consist of current and non-current liabilities. Based on the conceptual framework, an essential characteristic of a liability is

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What is Property Plant and Equipment (PPE)?

Property Plant and Equipment (PPE) is one among the items of the assets element presented in the financial statements. PPE consists of building, computer equipment, office equipment, furniture, vehicle or truck, and machinery, etc… it’s also called fixed assets or tangible assets. PPE is non-current assets in nature and an entity must recognize depreciation expense in each accounting period when preparing financial statements. PPE

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Four fundamental assumptions in preparing financial statements

Introduction When we talk about financial statements, we normally refer to the four main types of the financial statements. Those are statement of financial position which we normally call Balance Sheet, Statement of comprehensive income or income statement, statement of changes in equity and finally statement of cash flow. Each statement serve for different purposes.

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