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Fixed Installment Method or Straight Line Method or Original Cost Method of Depreciation: Learning Objectives: Define, explain and give example of fixed installment or straight line or original cost method.…
Gross Profit Analysis (GP Analysis): After studying this chapter you should be able to: Gross profit is the difference between the cost of goods sold and sales. Since the adherence…
Break Even Point Analysis-Definition, Explanation Formula and Calculation: Learning Objectives: Define and explain break even point. How is it calculated? What are its advantages, assumptions, and limitations? Definition of Break…
Fixed Cost Definition: A cost that remains constant, in total, regardless of changes in the level of activity within the relevant range. If a fixed cost is expressed on a…
Liquid or Liquidity Ratio / Acid Test or Quick Ratio: Definition: Liquid ratio is also termed as “Liquidity Ratio“, “Acid Test Ratio” or “Quick Ratio“. It is the ratio of…
Conceptual Skills Definition: Conceptual Skills are the skills managers must have to think and to conceptualize about abstract and complex situations. Using these skills, managers must be able to see…
Fixed Assets Turnover Ratio: Definition: Fixed assets turnover ratio is also known as sales to fixed assets ratio. This ratio measures the efficiency and profit earning capacity of the concern.…
Definition of net profit ratio: Net profit ratio is the ratio of net profit (after taxes) to net sales. It is expressed as percentage. Components of net profit ratio: The…
Fixed Assets to Proprietor’s Fund Ratio: Definition: Fixed assets to proprietor’s fund ratio establishes the relationship between fixed assets and shareholders funds. The purpose of this ratio is to indicate…
Break Even Formula ,analysis, definition and Calculation: Learning Objectives: Define and explain break even point equation. How break even point is calculated by formula or methods of estimating break even…
First Stage Allocation Definition: The process by which overhead costs are assigned to activity cost pools in an activity-based costing system.
Sale Mix and Break Even Analysis With Multiple Products: Learning Objectives: Calculate break even point when a company sells more than one product. Sale mix–Definition and Explanation of the Concept:…
Learning Objective of the article: Define and explain production budget. Prepare a production budget.(Formula and format) Definition and Explanation of Production Budget: The production budget is prepared after the sales…
First Line Managers Definition: Managers at the lowest level of the organization who manage the work of non-managerial employees who are directly involved with the production or creation of the…
Finished Goods Definition: Units of product that have been completed but have not yet been sold to customers.
Branches of Accounting: Learning Objectives: What are the branches of accounting? Accounting has three main forms of branches, viz, financial accounting, cost accounting, and management accounting. These forms of accounting…
Sales Budget: Learning Objectives: Define and explain sales budget. Give and example of sales budget. Contents: Definition and explanation of sales budget Example Definition and Explanation: A sales budget is…
Financing Activities Definition: All transactions (other than payment of interest) involving borrowing from creditors or repaying creditors as well as transactions with the company’s owners (except stock dividends and stock…
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