Conservatism Principle
Jennifer edwards Conservatism principle is an accounting principle that helps accountants in verifying the coming expenses, losses, profits and revenues. According to this principle accountants must use an approach where they must…
Calculating Full Time Equivalent
The full time equivalent is referred to the hours worked by a certain employee within a business on full time biases. There is a general calculation of full time equivalent…
Discount Allowed and Discount Received
A discount allowed is an accounting term where the seller grants a discount in payment to the seller. This kind of discount can be the early payment discount that is…
Purpose of Preparing Financial Statements
Although there are a number of different types of financial statements but the most important of all those are the income statement, the balance sheet and the statement of cash…
Other Comprehensive Income
Other comprehensive income is those expenses, revenues, profits and losses that are excluded from the net income of the business on the income statement of that accounting period. The concept…
Income Summary Account
According to the accounting terminology income summary account is a transitional account in which all the expenses and revenue accounts of the income statement are transferred at the end of…
Limit Pricing
Limit Pricing is a monopolistic pricing strategy in which the competitor sets the price of the product so low and at such a level that deter the other potential entrants…
Full Cost plus Pricing
This is a kind of pricing strategy in which you add all the costs that are involved in manufacturing and obtaining an end product and add a markup to the…
Pricing Strategies: Dynamic Pricing
Dynamic pricing is a pricing strategy in which different price is charged from different customers that means the price is altered for different customers. The alteration of the price depends…
What are Final Accounts?
Final Accounts is a term that is used in the basic bookkeeping procedures and is referred to the final trail balance of the accounts at the end of a certain…
Work in Process Accounting
In accounting the term work in process means the goods that are under the process of completion but are not completed yet. The work in process goods are somewhere in…
Working Ratio
The working ratio is a financial figure that shows either a business has an ability to cover its ongoing operating expenses within a given accounting period. Working ratio like many…
Stake Holder Value
Stake Holder value is an accounting concept that is based on the idea of creating maximum returns for all the stake holders involved in a business. The concept of stake…
Wealth Maximization
In accounting wealth maximization can be defined as a concept of maximizing the value of business. With the help of wealth maximization a business can increase the value of shares…
Foreign Exchange Accounting
A number of times such a situation arises in the business where the business has to receive a schedule payment from a client in foreign currency and in the same…
Double Declining Balance Depreciation
The double declining method of calculating depreciation is a kind of depreciation method in which the large amount of depreciation is calculated during the beginning years of the useful life…
What is Depreciation?
Depreciation can be defined as a reduction in the recorded cost of a fixed asset. There are a number of fixed assets that are routinely depreciated every year such as…
Internal Controls of an Inventory
The investment of a c company in its inventory is probably the biggest one for the business. As we know inventory is a collection of valuable and expensive items that…