What Is The Purpose Of the Pro Forma Statement?

Financial Statements

Businesses prepare financial statements; these are historical figures and do not guarantee profit or revenue in the future. If the business entity wants to predict future growth projection, there must be reliable measures and methodologies. Therefore, budgeting or...

What Is A Compilation Financial Statement? Explained!

Financial Statements

Depending on the size, nature, and industry of a business, there are varying financial reporting requirements for every business entity. Small and medium enterprises usually do not prepare formal financial statements and rely on bookkeeping. However, there are many...

What Is An Income Statement And Its Three Essential Elements?

Financial Statements

The business entities prepare the financial statements to conclude their financial transactions of a complete period. The financial statements are prepared by the management of the company and have many uses. The external stakeholders use the financial statements to...

Inventories Costing: Method, Example And More

Financial Accounting, Inventories

Overview Inventory costing is an integral part of inventory control and inventory management. It helps a business determine its cost of goods sold and eventually in gross profits. Different inventory costing methods can bring the different cost of goods sold results....

Perpetual Vs. Periodic Inventory System – Key Differences

Inventories

The perpetual inventory system is the process of keeping inventory records in real-time. The company updates its inventory account as and when it makes new inventory purchases. On the other hand, the periodic system first adds the inventory in the purchases accounts,...

Top 7 Uses (Purpose) of the Income Statement You Should Know

Financial Statements

The income statement offers an overview of a company’s performance over a specific period. It is perhaps the most widely used financial statement by different users, including managers, shareholders, and investors. The income statement reveals how much a company...