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The appearance of Allowance for doubtful accounts on a financial statement indicates what basis of accounting?
From my understanding, the use of ADA is a sign of accrual basis accounting. Accrual Accounting records all transactions as they are made, even when cash is not collected or paid out. ADA is used for customers who have purchased on credit and what the company can reasonably expect to be noncollectable.
In cash basis accounting, you would not need ADA because there are no "credit" sales recorded. All sales recorded or recorded only when cash is received.
What else can I help you with?
When reported in financial statements a lifo allowance account usually?
Indicates the effect on income if LIFO were not used.
What is adverse opinion?
An adverse opinion is an independent auditor's written view that an organization's financial statements are inaccurate. This indicates that the statements are misleading or may not follow accepted accounting rules.
What is adverse audit opinion?
An adverse opinion is an independent auditor's written view that an organization's financial statements are inaccurate. This indicates that the statements are misleading or may not follow accepted accounting rules.
Why capital is credited?
Capital is credited to reflect an increase in the owner's equity or the financial resources available for business operations. This occurs when a business receives investments from owners or generates profits that are reinvested. In accounting, crediting capital accounts helps maintain the balance in the accounting equation (Assets = Liabilities + Equity) and indicates a positive financial position for the business.
What is the accounting treatment for reimbursement?
The accounting treatment for reimbursement will be an expense to the organization. This will be credited on the cash book which indicates that the company has paid out money.
Distinguish between the recording and reporting process in accounting?
Recording indicates entering financial transactions into the accounting system such as bank withdrawal, insurance payments and employee salaries. Reporting denotes harvesting the data or transactions that were entered during the recording phase. Report generation can include anything from generating payroll numbers for executives to pulling sales numbers to apply for a loan.
Why Accounting is a means to an end and not an end in itself?
I think the accounting statement indicates that accounting is merely a tool, or a means, for measuring and determining the state of a business. Accounting is not an end in and of itself. Accounting doesn't define a business' purpose or goal. It's strategy and financing of a business plan that is actually the main purpose.
The appearance of crystals in mannitol injection indicates?
The appearance of crystals in mannitol injection indicates that the solution is supersaturated and may have undergone some form of physical or chemical instability. This could potentially impact the efficacy, safety, or stability of the injection, and further investigation or disposal may be necessary.
What is the appearance of joy?
A smile and laughter indicates joy. However sometime there can be tears of joy too.
An increase in a company's working capital ratio generally indicates an financial position?
stable
What does higher Sales Turnover indicates?
its means company have good financial position and having the goodwill
Would you prefer a low debt to equity ratio for your financial situation?
Yes, a low debt to equity ratio is generally preferred for a more stable financial situation. This ratio indicates lower financial risk and a stronger financial position.
