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How you can increase general reserve when your profit has also decreased?
Wiki User
∙ 10y ago
how can we increase the general reserve
Wiki User
∙ 10y ago
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What are the example of Revenues?
Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.
What are the examples of revenue reserves?
Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.
What should be Journal entry for creation of general reserve?
Reserves always created from profit. Therefore the Journal entry will be for creating reserves Dr Profit & Loss A/c CR Reserve A/c
What is the difference between general reserve and revenue reserve?
A reserve which is created out of the revenue profit is called revenue reserve. Revenue profit is earned in the normal course of the business. Revenue reserve refers to the undistributed revenue profit. It is created for strengthening the financial position, replacing deprecialble assets, redeeming liabilities, declaring uniform rate of dividend and conducting research and development functions. If the reserve is not needed in the future, it can be distributed as dividend to the shareholders.There are two types of revenue reserve:a) General ReserveA reserve which is created out of the profit not for a specific purpose is known as general reserve.General reserve is used for general purpose as per the discretion of the management. Usually, general reserve is used for strengthening the financial position and meeting future contingencies and losses.b) Specific ReserveA reserve which is created out of the profit for a particular purpose is known as specific reserve. Such reserve can not be utilized for any purpose other than specified. Specific reserve is created by debiting the profit and loss appropriation account. It can be invested in outside securities. It serves for a specific purpose as to equalize dividend or to redeem a fixed liability or to replace a fixed assets or to conduct a research and development work.The following are the important types of specific reserve:* Dividend equalization fund* Sinking fund* Research and development fund
If gross profit ratio has been increased in first year and gross profit ratio has been decreased in second year then what is the financial position of the company?
it mean the cost of sale sale of company increase or the direct cost increase
What is general reserve?
General Reserve, in short is the part of reserve amount kept by the company out of its profits for future purpose. Example, if the company might not expect any contingencies or unforseen happenings in the future. Usually, companies keep 20% aside the general reserves out of the total profit earned for a particular year or a certain period.
What is the difference between general reserve and specific reserve?
Capital Reserve:1.It is created out of the profit earned not in the normal course of business. For example, to a bookseller, profit on sale of books is a regular profit. But profit earned on sale of something other than books is capital profit.2.Capital employed in business is increased permanently.3.It is usually not available for the payment of dividends.4.Liability and loss of capital nature can only be met by it. General Reserve:1.It is created out of profit earned in the normal course of business.2.It increases capital employed temporarily.3.It is available for the payment of dividends.4.It is available for meeting any type of liability or loss. BALAJI GOUDA
How effective is outsourcing?
The factors of production become cheaper thus causing decreased production expenses and ultimately greater margins of profit. Simply put, strategic outsourcing allows one to increase margins of profit.
Reserve Is a charge against profit or not?
no.it is not charged against profit
What are the implications of Negative General Reserve in balance sheet of a company?
It would be shown as Debit Balance of Profit & Loss Account on Asset side
Is general motors for-profit or not-for-profit?
General motors is for profit company.
What is revenue reserve and its example?
The revenue reserve is the retained earnings which are shown in the company's balance sheet as part of the shareholders' funds and are set aside to use to continue to pay dividends even if the company makes a loss. The example of the revenue reserve are the credit balance of the Profit and Loss Account, General Reserve and etc...
