There are many different sources of finance that businesses can use to meet their needs. These sources of finance may include capital invested by the owners or debt received from third parties. In the case of companies, it also includes any equity finance raised through the issue of shares and equity instruments. Businesses need to […]
Capital Budgeting Techniques for Project Appraisal: The Ultimate Guide Read More »
Overview Financial statements are reports that provide information to their users regarding different aspects of the business. All businesses must produce financial statements. Sometimes, businesses prepare financial statements because they are required by relevant rules and regulations. However, some businesses, that are not required by rules and regulations, may also prepare financial statements voluntarily to
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Overview In this article, we will cover how to calculate EBITDA. Before going in detail, let’s go through the overview and basis definition of EBIDTA. Basically, there are many ratios and statistics that investors use to check whether investing in a particular business is profitable for them. These ratios can tell the investor different information
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Financial accounting rests on two pillars of recording and summarizing the accounting records. These accounting records from registering in a ledger to analyzing and interpretation must follow some rules. Without following rules the data presented and evaluated would be null and void. There are several accounting principles or concepts that a business can follow or
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The Money measurement concept is one of the basic accounting principles or theories that form part of the larger set of accounting rules. Record keeping and performance measurement are key components of an accounting cycle. Financial accounting is based on several principles such as business entity concept, historical cost, accrual basis accounting principle, matching principle,
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In this article, we will cover the budgetary slack. This includes the definition, causes, the Repercussion of budgetary slack and how to control budgetary slack. First, let’s go through the overview together before going further detail. Typically, all businesses prepare budgets of various types; budgets are an estimation of future expenses, revenue, cash flows, etc.
Budgetary Slack: Definition, Causes and How to Control Budgetary Slack Read More »
In this article, we will cover the six common performance measures for inventory management. This performance measures are sometimes called performance metrics or performance indicators (KPIs). Inventory management plays a key role in business efficiency. Businesses adopting lean manufacturing and total quality management approaches are particularly keen on inventory management. Efficient inventory management can affect
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In this article, we will cover the accounts receivable factoring. This will include the definition of factoring accounts receivables, aspect of accounts receivable factoring, types of factoring arrangements, as well as the benefit and limitation of accounts receivable factoring. Before jumping into detail, let’s go through basic overview. As you know, accounts receivable reside under
Accounts Receivable Factoring: Definition, Types of Arrangement and Example Read More »
Introduction In this article, we will cover the standard costing. This includes the definition, objectives, types of performance standard as well as the advantages and disadvantages of it. First, let’s go through the overview of standard costing. Cost accounting is the branch of accounting which, as the name suggests, deals with the recording, analyzing and
Standard Costing: Meaning, Objectives, Types, Advantages and Disadvantages Read More »
Overview In this article, we will cover how to calculate the predetermined overhead rate. The predetermined overhead rate is also commonly called predetermined absorption rate or predetermined overhead absorption rate. It also can be called as predetermined manufacturing overhead rate. Before jumping to detail, let’s go through the basic overview and key definition first. When
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