It helps make key investment decisions and ensures greater productivity and profits. Accurate financial information is a key necessity for the executives ...

A credit increases the balance of a liabilities account, and a debit decreases it. In this way, the loan transaction would credit the long-term debt accou...

Ledger is a verb and can also act as a noun. Should general ledger be capitalized in a sentence? Capitalize the “proper” name part of full names when usin...

Journal entry at the time of declaration of dividends: When dividends are declared, the retained earnings account is debited and dividends payable account...

Harmonisation is a process of increasing the compatibility of accounting practices by fixing the limits to their degree of variation. Harmonisation carrie...

Explanation: Owner’s capital is not usually involved in adjusting entries. The account tracks the owner’s investment into the company and net income is cl...

One of the assumptions of CVP analysis is that costs will behave in the same manner within the relevant range. The relevant range represents the activity ...

A P&L usually has five main components: revenue (sales/turnover) cost of goods sold (COGS) gross profit (revenue minus COGS) What is profit or loss ac...

Summary of FIFO, LIFO and WAC The ending inventory is valued at the highest amount on the balance sheet. On the other hand, LIFO produces the highest cost...

A good liquidity ratio is anything greater than 1. It indicates that the company is in good financial health and is less likely to face financial hardship...