The cash-flow statement is one of the most important documents for making management decisions. While the company can look profitable based on standard ac...

reducing-balance method The reducing-balance method, also known as the declining-balance method, in the initial years of an asset’s “service.” As with the...

Called up share capital not paid. This is the amount that has been called for when shares have been allotted but that amount has not been received as at t...

Net worth of a company is the value of the assets a company owns, minus the liabilities they owe. Hence we can say that the Companies Act, neither in ‘Net...

A liquidator takes control of a company when it can no longer pay its debts in full. The liquidator will close premises, help staff make redundancy claims...

The Purchase Account is a Nominal account and the Creditors Account is a Personal account. Applying Golden Rule for Nominal account and Personal account: ...

Neutrality requires that management prepare completely unbiased financial statements. For example, a company with information about a probable lawsuit mus...

The total of the manufacturing costs per unit equals the product cost per unit. The material, labor, and overhead are the manufacturing costs from the lis...

Decrease in Equity A decrease in the owner’s equity can occur when a company loses money during the normal course of business and owners need to move equi...

The Australian Accounting Standards Board (AASB) is an Australian Government agency that develops and maintains financial reporting standards applicable t...