Financial Statements Archives - Page 7 of 15

Accounting for equity reserve: Types of Equity Reserves and Their Accounting Treatment

Meaning of Equity Reserves Reserves refer to a component of shareholders’ equity, the amount kept apart for estimated claims or creation of contra asset accounts for bad debts. Reserves always have a credit balance. The reserve which belongs to equity shareholders or where it is marked for any purpose is equity reserves. The reserves appear […]

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What Are Other Current Assets? Formula and Example

Current Assets

Other current assets are a type of categorization of assets. These are residual current assets that have not been specified by the company or regulations or do not meet the criteria of being classified separately. They are referred to as they are uncommon and insignificant, like the current assets like cash, accounts receivables, and prepaid

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Statement Of Changes In Equity: Purpose, Definition, Example and More

Financial Statements

Overview: The statement of changes in equity is one of the four main financial statements prepared by the entity for the end of the specific accounting period along with other statements such as balance sheet, income statement, and statement of cash flow. This statement normally presents the entity’s capital, accumulated losses, or retained earnings, depending

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What is inventory profit? (Types, Meaning, Example, and Calculation)

Inventories

Businesses that deal with physical products will have inventory at some point during their operations if not always. Inventory is a term used to describe all tangible materials that businesses use to manufacture products for sale. For businesses, it is one of the most important assets as it is the main reason for the revenues

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INCOME STATEMENT PRESENT BY NATURE

Financial Statements

The income statement of a business, also known as the statement of profit or loss. It is among the five key financial statements for businesses. The other four are the balance sheet (also known as the statement of financial position), the statement of owners’ equity (also known as the statement of changes in equity), the

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INCOME STATEMENT PRESENT BY FUNCTION

Financial Statements

Any business has 5 main financial statements. These are the Balance Sheet (Statement of Financial Position), the Income Statement (Statement of Profit or Loss), the Statement of Owner’s Equity (also known as the Statement of Changes in Equity), the Cash Flow Statement (Statement of Cash Flows) and the Notes to the Financial Statements. These key

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What Is the Difference Between Share Capital and Liabilities?

Financial Statements, Unearned revenue

Introduction: The balance sheet, also known as the statement of financial position, is one of the annual financial reports that exhibit a company’s financial position as at the year-ended. Share capital and liabilities are both line items of the balance sheet. The statement of financial position is based on the accounting equation, which is also

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Unearned Revenue vs Unearned Income – Key Different Explained

Unearned revenue

Unearned Revenue: Unearned revenue is the money received by an individual or a company for services that have yet to be provided, or goods that are yet to be delivered. This is a prepayment from the buyer for goods and services to be supplied at a later date. This would count as a liability for

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Unearned Revenue vs Unbilled Revenue – What Are the Different?

Unearned revenue

Unearned Revenue: Unearned revenue is the money received by an individual or a company for services or goods that haven’t been supplied or provided yet to the buyer. This counts as a prepayment from the buyer’s perspective for goods and services that need to be supplied at a later date to them. Unearned revenue is

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Unearned Revenue Vs. Unrecorded Revenue (Explained)

Unearned revenue

Definition and meaning: Unearned Revenue: Unearned revenue is the cash obtained from a customer in advance of providing the goods or services they are purchasing. It is considered a short-term liability instead of revenue because, as per the revenue recognition principle of accounting, revenue is reported only when earned. Since the company owes money to

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