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Financial Statements
A financial statement is a record of the financial activities of a person or business entity where all related financial information are presented in an orderly manner and can be easily understood.
5,583 Questions
What is the importance of profit and loss account?
It provides information about net profit or net loss earned or incurred by the business during a particular period.
Accounting data for determining efficiency:
Net results provided by the Profit and Loss Account can be compared with the net results of the previous years and the efficiency of the business can be determined by such inter-period comparison of results.
Control over expenses:
Profit and Loss Account provides information about various kinds of expenses. The expenses of the current year can be compared with the expenses of the previous year and effective steps can be taken for the control of expenses, where it becomes necessary.
Future Profit Planning:
Net profit of various years can be taken as basis for future profit-planning. It helps the business in the allocation of sources and future expansion.
balance sheet
Where does Netprofit appear in the Balance Sheet?
Net profit appears on liabilities of balance sheet . Net profit is added to capital.
dividend will affect the cash flow when actual cash is paid and not at the time of declaration of dividend.
What is the principal concern with accounting for related party transactions?
Differences between economic substance and legal form.
How do you treat irreconcilable Intercompany Account?
No accounts are irreconcilable. You may give uo looking for the difference but that doesn't mean it can't be found.
What is meant by the phrase different cost figures for different purpose?
they differ over range of costs included
current and future costs assumed
the frequently product costing information is required
Where do you find common stock in the cash flow statement?
Common stock is shown under "Cash flow from financing activities" section of cash flow statement.
What are the cost and benefits of holding cash?
Benefit of holding cash is that it can be use in emergancy needs as well as it can be invested in some marketable securities or profitable investment activities while if less or not excess cash maintain then it can be harm the overall operations of business as in case of emergancy or in case of profitable investing opportunities if cash is not available those opportunities may be not avail by company so there are cost and benefits for having no cash or too much cash so it is the duty of financial managers to find the optimal between no cash and too much cash in hand.
Does dues and subscriptions go on a balance sheet or income statement?
Income Statement under operating expenses.
This is a non-accounting voucher and the entries made using memo voucher will not affect your accounts.
What is the treatment of interest received on marketable securities in cash flow statement?
Interest received on marketable securities is shown as an increase of cash from investing activities in cash flow statement.
What financial statement is a representation of the accounting equation?
The Balance Sheet shows that Assets = Liabilities + Equity
Auditors refer to situations where the outcome of a matter cannot be reasonably estimated at the time of issuing the financial statements as an uncertainty. Uncertainties are disclosed in the financial statements to notify users that there is a potential for a significant impact on the financial statement values. Auditors evaluate the nature and extent of uncertainties to determine if appropriate disclosures have been made.
How can you benefit from cash flow Excel?
Cash flow excel has numerous benefits. This software can be used to streamline the bookkeeping for your small business. Combined with built-in tools and equations, cash flow excel allows you to maximize profitability and minimize your investment risk.
How does cash flow work and what is the benefit of cash flow?
If you don't have funds or budget your money you won't have positive cash flow. The benefits of positive cash flow are: you won't have financial issues and you will have enough money to purchase required products.
Where can you find training to become a cash flow investor?
Courses in business management will often include a component on cash flow managing, and will teach useful skills to enable you to become knowledgable enough to become a cash flow investor. You can find such courses on the internet, at your local community college, or run by private companies.
Is net gain the same as net profit?
No, Net profit is always from revenues from operating activities while net gain can be from any transaction for example from sale or disposal of old fixed asset etc.
