First in First Out-FIFO Method Definition: A method that operates under the assumption that the materials which are received first are issued first and, therefore, the flow of cost should be in the same order. Issues are priced at the same basis until the
Feedback Definition: Accounting and other reports that help managers monitor performance and focus on problems and/or opportunities that might otherwise go unnoticed. Recommended Books ! Or Download E accounting book in MS-word format for just 20 $ - Click here to Download
Basic Factors of Determination of Depreciation: Learning Objectives: What are the basic factors of depreciation determination? For calculation depreciation the basic factors are: The original cost of the asset. The estimated working life of the asset or the number of years the asset is
External Failure Cost Definition: Costs that are incurred when a product or service that is defective is delivered to a customer.
External Environment Definition: Outside institutions or forces that potentially affect an organization’s performance.
Extended Example of Net Present Value Method: Difficulties Encountered in Process Costing Procedures: Learning objectives of this article: What are the difficulties or Limitations in a process costing procedure? Certain difficulties likely to be encountered in actual practice should be mentioned with regard
In this article we will discuss how to calculate expense ratio in insurance and total expense ratios meaning with calculation with ratio formula Definition: Expense ratios indicate the relationship of various expenses to net sales.The operating ratio reveals the average total variations in expenses.
Trading account format and accounting trading and profit and loss account examples in balance sheet. Different solved problems in trading profit and loss a/c in final accounts format for carriage outwards. Learning Objectives: Prepare trading and profit and loss account and balance sheet. Example
Example of Ledger and Preparing Ledger Accounts: Learning Objectives: How are ledger accounts prepared? Journalise the following transactions and post them to the ledger accounts concerned: 1991 Jan. 1 Purchased goods for cash 2,000 Jan. 3 Sold goods to Karim 500 Jan. 10 Received
Equivalent Units of Production: Definition and Explanation of Equivalent Units of Production: After materials, labor and overhead costs have been accumulated in a department, the department’s output must be determined so that unit cost can be computed. A department usually has some partially completed
Equivalent Units of Production Definition: The product of the number of partially completed units and their percentage of completion with respect to a particular cost. Equivalent units are the number of complete whole units one could obtain from the materials and effort contained in
Proprietary Ratio or Equity Ratio: Definition: This is a variant of the debt-to-equity ratio. It is also known as equity ratio or net worth to total assets ratio. This ratio relates the shareholder’s funds to total assets. Proprietary / Equity ratio indicates the long-term
Environmental Uncertainty Definition: The degree of change and degree of complexity in an organization’s environment.
Environmental Complexity Definition: The number of components in an organization’s environment and the extent of the organization’s knowledge about those components.
Entrepreneurship Definition: The process whereby an individual or group of individuals uses organized efforts to pursue opportunities to create value and grow by fulfilling wants and needs through innovation and uniqueness, no matter what resources the entrepreneur currently has.
Engineering Approach Definition: A detailed analysis of cost behavior based on an industrial engineer’s evaluation of the inputs that are required to carry out a particular activity and of the prices of those inputs.
Endorsement of Bill of Exchange: Learning Objectives: What are the journal entries in the books of drawer, acceptor and endorsee when a bill of exchange is endorsed by the drawer? When a bill of exchange is negotiated i.e., transferred from one person to another
Ending Finished Goods Inventory Budget Definition: A budget showing the dollar amount of cost expected to appear on the balance sheet for unsold units at the end of a period. Read full article about ending finished goods inventory budget.