Financial Accounting

Financial Accounting involve recording financial data and preparing financial statements of entity based on accounting standards or reporting frameworks.

  • Types of Financial Statements
  • Element of Financial Statements
  • Balance Sheet
  • Income Statement
  • Accounting principle
  • Assets
  • Liabilities
  • Retained Earning
  • Trial Balance
  • Financial Statements Analysis
  • And others importance topics related to auditing

The Concept of Predetermined Overhead Rate: (Formula, and Example)

Predetermined Overhead Rate Predetermined Overhead Rate is the overhead rate used to calculate the Total Fixed Production Overhead. It is part of the Absorption Costing calculation. The Predetermined Rate is usually calculated annually and at the beginning of each year. This rate will be recalculated if the predetermined is materially incorrect or different from the …

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Ultimate Guide to Financial Accounting (For Beginner)

Definition: Financial accounting is one of the essential functions of Financial Management in the Financial Department or Financial Division. Because of its usefulness and necessity,  we can say that this function is one of the strategic functions of the entity. This function is responsible for preparing financial reports, controlling the financial position and cash flow, …

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Operating Expenses: Definition, Example, Formula, and List

Definition: Operating expenses are the expenses incurred in the entity for its normal operational purposes and activities that generally include both the cost of products or services and sales & administrative expenses. Operating expenses are generally defined when identifying and assessing the theentity’ss operating profits. Like other income statement items, these expenses are recorded in …

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Contribution Margin (Definition, Formula, Example, and Explanation)

What is the Contribution Margin? The contribution margin is basically the sales price less variable cost. The contribution margin in percentages is calculated by sales price less variable cost and then divided by sales price. Mostly we use net sales to calculate the contribution. Variable costs are direct costs, including direct materials, direct labor, and other …

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Net Income: Formula, Definition, Explanation, Example, and Analysis

Definition: Net income is sometimes called Net Profit, Bottom Line, or Net Earning. It is the net earnings from the operating activities and other income for a specific period of time. Net Income results from gross profits for the specific period less than their corresponding expenses of the same period. Those expenses are Cost of …

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What is Going Concerned? Definition, Assessment, Indicators, Example, Disclosure

Definition: In accounting, going concerned is the concept that the entity’s Financial Statements are prepared based on the assumption that the entity operation is still operating normally in the next foreseeable period. This foreseeable period normally has twelve months from the ending period of Financial Statements. In order to assume that the entity has no …

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Ledger Account – Definition, Types, and Examples

Overview Ledger accounts are the accounting units that present the summarized balances of transactions under each category. A general ledger is the collection of these ledger accounts. A business can have five types of ledger accounts: assets, liabilities, equity, revenue, and expense. Let us discuss the definition and types of ledger accounts with the help …

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