Financial Statements

Top 7 Uses (Purposes) 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 statements by different users, including managers, shareholders, and investors. The income statement reveals how much a company earned during the year, spending, tax, interest, and net profits. It also reveals how much profits […]

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What Is a Periodic Inventory System? (Advantages and Disadvantages Included)

Current Assets, Inventories

The periodic inventory system is the physical counting method for inventory management. It is performed periodically to calculate inventory figures that lead to the cost of goods sold. A periodic inventory system takes time and effort as it is a laborious activity. Small businesses mostly follow the periodic inventory system with low inventory requirements. However,

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How Is Cost of goods sold Reporting In the Income Statement?

Cost of goods sold, Financial Statements

Overview: There are always the costs associated with the product that the company sells to its customers. Some costs are directly associated and some costs are not directly associated with the products. Direct labor and direct material are good examples of the costs directly associated with the products. And mission expenses to sellers are the

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5 Types of Financial Statements (The Completed Set and Beginner Guide)

Financial Statements

Overview: Financial statements are reports or statements that provide the details of the entity’s financial information, including assets, liabilities, equities, incomes and expenses, shareholders’ contributions, cash flow, and other related information during the period of time. These statements normally require an annual audit by independent auditors and are presented along with other information in the

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What Is the Income Statement Under Marginal Costing? (Guidance)

Income Statement

The different methods of costing used in a manufacturing business, result in variations in the format of income statements. If you understand the differences between the various methods of cost, you will understand that these variations are necessary because each method of costing, brings slight changes to the cost of production of the finished goods.

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What is the Income Statement Under Absorption Costing? (Guidance)

Income Statement

The different methods of costing used in a manufacturing business, result in variations in the format of income statements. If you understand the differences between the various methods of cost, you will understand that these variations are necessary because each method of costing, brings slight changes to the cost of production of the finished goods.

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Income Statement Under Absorption Costing: Explanation, Example, And More

Income Statement

Most people, especially those in accounting, would have questions to ask about absorption costing and income statements. Absorption costing is often used interchangeably with the term full costing, and they are usually identified to have similar meanings. Generally, absorption costing has to do with situations that affect the manufacturing costs of companies. It includes all

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Understanding Stockholders Equity in Balance Sheet – What is included in shareholders equity?

Balance Sheet

The Company stockholders’ equity also known as shareholders’ equity is an account contained in the balance sheet. It expresses the amount the owner or owners of a company has invested in the business over time. In this article, you will get to understand the components of stockholder’s equity in the balance sheet, its calculation, and

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Understanding Loan In Balance Sheet: Classification, Recognition, Measurement & More

Balance Sheet

The capital structure of a company speaks a lot about the financial position and future prospects of growth. The capital structure of a business entity represents the source of funding. More generally, it is recommended to keep the debt financing at a lower level as compared to equity financing. But there are many instances when

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Understanding Retained Earnings in the Balance Sheet: Classification, Recognition, Measurement and More

Balance Sheet

Retained Earnings When a company is formed, the main objectives behind setting up a business are earning profits and expanding the business in the future. Profits are the lifeblood of any business, either sole proprietorship, partnership, or corporation. A business owner can expand the business by reinvesting his profits. A partnership or a corporation can

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