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Amortization is the paying off of debt with a fixed repayment schedule in regular installments over a period of time. The gradual elimination of a liability, such as a mortgage.
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What is the meaning of amortisation of translation reserve?
Amortization or amortisation is the process of decreasing or accounting for an amount over a period of time
Is amortisation of goodwill a disallowable expense?
i don't no, but amortization of lease is disallowable expense
What is meant by amortisation?
Paying for something really expensive with many small payments over a period of time.
When do you use ebit versus ebitda?
The difference between EBIT and EBITDA is depreciation and amortisation - why include or exclude depreciation and amortisation? In both cases we are trying to estimate a base level of cash flow from the business. The two key components of calculating this base level of cash flow are the profits that the business produces and the on-going investments required by the business to achieve these cash flows - the capital expenditure that the company needs to undertake to achieve the profitability. EBIT includes depreciation and amortisation, which are not cash items, but that act as estimates (imperfect - but an estimate) of capital expenditure. EBITDA removes depreciation and amortisation and thus just focuses on the profitability of a company without considering the investment required to achieve the profitability. peace nz
What is EBIDAT?
Earnings before interest and depreciation after taxes # I don't believe this person's answer is correct - after a long search I found the following meaning "Earnings Before Interest, Depreciation, Amortisation >And< Tax" #
How to amortize Intangible assets?
Only to amortize intangible assets which are recognised as finite useful life. There are tow models, one is cost model, another is revaluation model. The way to charge intangible assets' amortisation is same as charging depreciation on physical non current assets. Carrying amount (net book value) is equal cost or re-valuated amount less any subsequent accumulated amortisation and any impairment losses. However, Revaluations should be regularly made so the carrying amount does not differ from the recoverable amount (it is the higher amount of net realisable value or value in use) at the end of the reporting period. On the other hand, If the intangible assets are recognised as definite useful life, there is no need to charge amortisation on the profit and loss. But annually impairment test should be carried out. A impairment loss or a revaluation surplus will be adjusted on both income statement and balance sheet. Hope it is helpful!
What is the difference between amortization and sinking fund?
sinking fund is the setting aside of money for instance by the government to a pool to reduce its budget deficit while amortisation is the paying off of debts over a period of time with a decreasing principal balances and interests
What is amortisation period of intangible assets?
Normally it's 5 years with equal amounts each year so it's similar to straight line depreciation except at the end of the 5 years the asset will not be shown on the balance sheet sheet at all.
What are the differences between amortization and depreciation?
These are two separate financial and business related terms. Depreciation regards the loss of value of product over time due to age, wear, and obsolescence. Amortization regards the payment schedule of those goods and services financed. Amortization and depreciation are related as financiers may calculate loss of value as part of the repayment. This is especially important when cars are leased, as the amortization amount takes into consideration loss of value.
What is the difference between amortization and impairment?
impairment is the decrease of fair value of an intangible asset where amortisation is periodic (usualy yearly) distribution of cost of an asset over its life. suppose a factory equipment worth 25000 and estimated life is 5 years, we will charge 25000/5=5000 /year on a straightline basis as amortisation. Now suppose with this equpment we can build something which required licencing...suppose the machine is used for making coca cola. To obtain the licence, the cost is 100,000. so the licence is an intangible asset. IAS reqires intangible ASSETS to be revalue atleast a year to see whether the fair value has increased/decreased. If the fair value is decreased from the cost/ carrying amount... we say the asset has impaired. And we record the value by which the asset has been impared. Note, Useful life has nothing to do with impairment. Fair value can be market value at the date of the impairment test.
Calculate average loan life of a term loan?
It will be different from final maturity, in case this is an amortising loan. In essence, you should be looking at this particular term loan as a series of shorter term loans with different final maturities. So to calculate the average life, you should calculate the average of these multiple maturities weighted by the debt sums (aka debt amortisation sums). - - - - - Say if you have borrowed £100 with semi-annual amortisation over a period of 10 years, £5 is due in 6 months, another £5 in 1 year... another £5 in 9.5 years and the final £5 in 10 years. In Excel use SUMPRODUCT function to multiply an array of maturities (0.5,1,...,9.5,10.0) by an array of debt sums (£5,£5,...,£5,£5). You'll then divide the result over the total amount (£100). The result should be 5.25 years. This is a reflection of the fact that your liability decreases over time.
Is maths needed for being a charted accountant?
There is a[n extreme] lot of arithmetic in accounting, along with the use of of arithmetic progression and geometric progression (eg for the calculation of depreciation/amortisation); there is also correction for inflation (which I haven't got to yet in my course). Knowledge and use of a spreadsheet would be useful. Traffic flow, numerical analysis and analysis of algorithms ([units] of my maths degree) have not featured very much; however, the ability to think logically and systematically is important when trying to sort out the accounts and prepare financial statements of someone who hasn't been doing much bookkeeping (let alone double-entry bookkeeping) and may not know a figure or two. These days, having a good degree is[/seems to be] vital to get into graduate training (especially with the big firms). I did see a company advertising for a school leaver and a graduate as trainee accountants, so a degree is not necessary, but obviously the school leaver would have been on a lower wage/salary and would probably have had to take more lower level exams. All-in-all I would expect a good grade at GCSE maths would be required, especially the arithmetic side along with being able to do some algebra.
