Due to the vast amount of information available, it is easy to get lost. Usually, this data comes from several sources, which makes it challenging to collect. Most users looking for specific information must go through all those sources to ensure they cover all bases. However, they may use aggregators to help them in this […]
What is the Meaning of Aggregation in Accounting and Finance? Read More »
A prepayment is an amount paid in advance to a supplier of goods or services. Usually, it encompasses the customer’s commitment to initiating a contract. In some cases, suppliers may require this advance payment to ensure the customer will pay them later. In others, it may be a requirement to make an advance payment before
What Is Advance Rent, and How Does It Work? Read More »
For most contracts, companies pay after the goods or services get delivered. Usually, this process involves the company entering an agreement with the supplier. This agreement will mention the details of the transaction. Once the supplier satisfies their obligations, they will send the company an invoice. The company then pays for it, which concludes the
“Deposit” Vs. “Down Payment” Vs. “Advance (Payment)” Read More »
Accounting ratios are metrics that allow stakeholders to calculate the relative magnitude of two selected values. These values come from a company’s financial statements, usually the balance sheet and income statement. Usually, stakeholders use various accounting ratios, which fall under several categories. For example, these may include liquidity, profitability, leverage, etc. In most circumstances, accounting
What Is a Good Acid Test Ratio? Here Is What You Should Know Read More »
Companies raise finance through several sources, the most common of which include equity finance. This finance comes from a company’s investors or shareholders. Usually, equity finance is perpetual, meaning companies keep it until closure. However, this finance source comes with a higher cost due to its long-term nature. In some cases, companies may want to
What is the Regular Interest? And how is it different from Accrued Interest? Read More »
Financial ratios are metrics related to a business or company’s financial statements. These ratios allow stakeholders to gain meaningful information about operations and other aspects. Usually, these metrics involve calculating the relative magnitude of two metrics obtained from the financial statements. In accounting, several accounting ratios provide better insights into a company. Financial ratios are
How to Calculate the Accounts Receivable to Sales Ratio Read More »
The term bank account represents a financial account maintained by a bank or other financial institution. These institutions have many customers. Usually, every customer has a separate bank account that separates their transactions from others. Therefore, a bank account records the financial transactions between the bank and a customer. Bank accounts are crucial for all
What is a Bank Account Statement? Example and Explanation Read More »
Expansion is a crucial part of any business or company’s operations. Every entity works to grow and expand its operations. Whether these are small or large organizations, growth and expansion are among the factors that measure success. Usually, the primary objective behind this process involves attracting more customers or serving more people. Regardless of the
What Does Accretive Mean in Finance? Read More »
In the past, entities transacted in cash. However, this process had various limitations and challenges. The most crucial of these included the security of the cash resources. Similarly, it involved taxation issues and the unavailability of a trial. However, banking transactions solved most of those limitations. These transactions involved using an accumulated account balance to
What Is an Account Balance? (Definition and Examples) Read More »
For most companies and businesses, the only revenue source will be their primary operations. These operations will differ from one company to another based on their activities and industries. These operations may consist of sale proceeds from selling products or rendering services. Similarly, each company has unique operations that allow it to earn income. Some
Accounting for Loyalty Income (Beginner Guide) Read More »