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 […]
The Infamous Enron Accounting Scandal
In the late 1990s, Enron was one of the largest companies in the United States. It was an energy company with a high-flying stock price and a reputation for being innovative and forward-thinking. In 2001, it all came crashing down. Enron was revealed to be a fraud. The company had been overstating its earnings and […]
The Meaning of Consignment Accounting
Consignment refers to selling the goods manufactured by a company through an agent. This sales method is especially popular among businesses located abroad who want to sell their products in your country. For example, if a US-based company wants to sell its phones in India, it can hire a local agent who will sell the […]
What are various methods of valuation of goodwill?
Goodwill is an intangible asset that represents the value of a business’s reputation, customer base, brand recognition, and other non-physical assets. Valuing goodwill can be challenging because it does not have a physical existence or a straightforward way to measure its worth. However, it is an essential element in determining the overall value of a […]