A balance sheet is basically a statement of assets and claim over assets of an entity as at a particular date. It should be noted that the double entry principle is not followed since a balance sheet as its name implies is just the gathering together of balances which are then presented in a special way.
Double entry Accounting – Explanation with examples
When recording transactions, each complete entry is recorded twice as debit entry and credit entry. These two entries taken together are referred to in accounting as double entry, and the approach of recording, in which a complete entry is recorded twice, is referred to as double entry system.
As accounting students, we quickly subscribed to the idea of finishing school and working for one of the big four’s. That was the ultimate dream and every one was fighting for the chance of being picked by any one of them. The big four’s as you all know are Deloitte Touche Tohmatsu Limited, PriceWaterhouse Coopers (PwC), Ernst & Young and Klynveld Peat Marwick Goerdeler (KPMG).
A variance is the difference between the expected standard cost and the actual cost incurred. Variance analysis is broken down into two parts; which are the usage and price variance of resources. These variances can be combined to reconcile the total cost difference revealed by the comparison of the actual and standard cost.
The income statement starts from the top line which is the revenue and work its way down to the bottom line which is the net income. We take the net revenue and subtracting expenses (including interests and tax) to arrive at net income. Under the international financial reporting standard, the income statement can be combined with other comprehensive income and presented as a single statement of comprehensive income
Bank reconciliation Statement: Preparation and Format
The first step in a bank reconciliation statement is to prepare an adjusted cash book. This is to take cognizance of either charges or receipts that may have occurred directly in the bank account without the knowledge of the business. Some of the transactions that may occur and their treatment in the cash book include...
Overhead has been defined as the total cost of indirect materials, indirect wages and other indirect expenses. The word “indirect “ in this context means that which cannot be allocated but which can be apportioned to or absorbed by cost centers or cost units.
CVP analysis is a very powerful tool in management accounting. Its main purpose is to help management understand the relationship among cost, volume and profit, and management uses the information derived from the analysis to make sound business decisions regarding products to be produced and sold..
Pricing decisions are very important decisions organizations need to make. It can make or mar a business. If prices are too high, there is a tendency that consumers avoid your products and move on to similar products with lower prices. Discover pricing strategies that would keep your business competitive.
Definition and Explanation of Cash book with examples
A cash book is a financial journal in which cash receipts and payments including bank deposits and withdrawals are recorded first in a chronological order (ie recorded according to the date of transaction). There are two types of cashbooks, and they are the 2-column cash book and the 3-column cashbook. Before going into....