The Economic Entity Principle of Accounting
Jennifer edwards The economic entity principle of accounting is a principle that gives us guideline about storing the financial information of a given entity. This principle states that the financial information of…
How to define a dividend policy
Dividend policy is a form of document that is designed by the management and decision makers of the company to decide the amount of dividend that must be paid to…
Contingent Liability
A contingent liability can be defined as the loss that is not calculated at present but may occur at some point in future. The contingent liability comes in to the…
Accounting for bad debts and early payment discounts
Whenever a company sells its products and services the amount is either paid in cash on hand or the customers are allowed to pay for the products later. Whenever the…
Sales Tax Accounting
Sales tax is a kind of tax that is charged to the customer whenever the customer makes purchase of a certain product. The sales tax is charged by the company…
Asset Purchase Process
Asset purchase is a type of acquisition in which the purchaser only wants to purchase the assets of the seller. Although asset purchase is a common practice but it must…
The Acquisition Process
The acquisition process is a process of acquiring another company, business or a firm that have a related business and can prove beneficial for the acquirer. The process of acquisition…
Different Types of Dividends
Dividend can be defined as the payment made to the stockholders of a company that have a share in the company’s profit as they have invested equity in the company.…
Cost to Cost Method of Revenue Recognition
It is a method of revenue recognition that is used by the accountants to find out the percentage of completion of project, revenue associated with project and the cost associated…
Profit Velocity Analysis
Profit Velocity Analysis is a method of evaluating the products to find out which products take highest time to get pushed from the manufacturing bottle neck. Most of the companies…
Petty Cash Accounting
A small amount of cash that is kept reserved by a business to fulfill sudden but small every day operational needs is called petty cash. The small cash needs may…
Calculation of Stockholder Equity
Stockholder equity can be defined as the financial share of the stockholder in a business. It can also be defined as the residual funds invested by the stockholder in the…
Current Liabilities Explained
Current liability is that entry of the balance sheet that has to be paid by the company to any third party within a year. It is the responsibility of the…
Annual Return over an Investment
The annual rate of return is the return that an investment provides a business over a period of one year or annually. The annual return is shown in a time…
Acquisition Accounting
Acquisition accounting is a formula or a method of showing the financial position of a company a purchasing company on the consolidated statement of the company. The term acquisition accounting…
Active Asset
An active asset is an asset in the business or a firm that is used on regular biases and is used as an active part of a business operation. Active…
Activity Cost Driver
Activity cost driver is a factor or a certain indicator that affects the certain activities within a business and also affects the cost related to those activities. As the name…
Accumulated Fund
Accumulated fund is the fund that is accumulated over time by non-profit organizations such as NGOs and other such organizations. Accumulated fund is not used to by operational or other…