What Are the Factors Governing Dividend Decisions?
Dividends are an essential aspect of a company’s financial strategy. It is the distribution of profits to shareholders, which can be in the form of cash or additional shares. The decision to pay dividends is crucial and requires careful consideration by the company’s management team. Several factors govern this decision, such as financial performance, growth […]
Meaning of Treasury Stock and Its Accounting Treatment
Treasury stock is the stock issued by the company and may later be reacquired by the company from its shareholders. The company may retire or cancel these stocks. The reacquired stock which is not retired by the company is called “treasury stock”. Treasury stock is not an asset for the company. A company creates its […]
Classification of Accounts in Bookkeeping
Bookkeeping is the basis of financial management. All business transactions must be systematically recorded and categorized in bookkeeping. Classification of accounts is one of the most important part of bookkeeping which facilitates the organization of financial data for reporting and analysis. Proper classification does not only simplify financial tracking but also enhances decision-making through the […]
How to Prepare Profit and Loss Account?
A profit and loss account, also known as the income statement or statement of revenues and expenses, is prepared to ascertain the profit earned or losses suffered by the business entity. We have already discussed the theoretical concepts of profit and loss accounts. Now here we shall discuss only practical aspects only. The profit and Loss […]
What are Coverage Ratios – Meaning and Calculation
A coverage ratio is a common metric used in financial analysis that determines how much of a company’s assets are covered by its liabilities. This ratio can help determine whether a company is financially stable and able to meet its obligations. The coverage ratio measures the firm’s ability to service or repay the fixed liabilities. […]
List of Indian Accounting Standards (IND ASs)
The Indian Accounting Standards (IND-AS) are a set of accounting standards notified by the Ministry of Corporate Affairs, Government of India. IND-AS are based on International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). The Indian Accounting Standards apply to all companies, including listed companies and unlisted public sector companies. The […]
Why should India adopt IFRS? Potential Benefits Explained
IFRS (International Financial Reporting Standards) is a set of accounting principles that are used globally for financial reporting. The main objective of IFRS is to create a single global language for business affairs by providing transparent and comparable information in financial statements. It was introduced by International Accounting Standards Board (IASB) to enhance the uniformity […]
What is Financial Statement Analysis?
The term ‘financial statement analysis‘ refers to determining the firm’s financial position by reviewing and analysing the balance sheet items, profits and loss accounts, cash flow statements, funds flow statements, etc. The financial analysis aims to understand the company’s financial health to judge the firm’s profitability. Several groups of stakeholders are interested in the analysis […]
Tips to Consider While Buying Used Tow Trucks for Your Business
There are so many tow trucks available on the market. Therefore, it is challenging for business owners to select the types that will greatly impact the fleet. Before you choose just any truck, you would like to take into account several factors. So, to search for the best-used tow trucks for your company, we put […]
What are the Various Objectives and Functions of FASB?
The Financial Accounting Standard Board (FASB) was founded in 1973 as an independent, private-sector, not-for-profit organisation. It establishes accounting principles and accounting procedures. The body of this principle and procedure is called General Accounting-Accepted Principles (GAAP). The Security and Exchange Commission and the Financial Accounting Foundation regulate FASB. Understanding the various objectives and functions of […]