Accounting

The current business dynamic has increased the complexity involved with business decisions pertaining to investments. This requires them to study the organization and look at the financials so that they can have an idea about the organization’s position. There are certain key factors that investors need to account for before they can make their decision …

What are the Investor Ratios? (Definition, Types, Formula, and Example) Read More »

What is the definition of reserves? Reserves can be defined as the portions of business profits that have been retained by the company, either for future investments or for unforeseen circumstances. They are mainly set aside to strengthen the financial position of the business. During the normal course of the businesses, profits earned over a …

Accounting for Reserves – Types, Explanation, and Classification Read More »

Definition Prepaid Insurance can be defined as the charge that is associated with the insurance contract, which has been paid in advance by the company the insurance company for the coverage period and sum insured based on insurance policeis. In other word, prepaid insurance is simply the amount expended for a given insurance contract, the …

How to Account for Prepaid Insurance? (Definition, Classification, Journal Entries, and Example) Read More »

Definition of Average Total Assets Average Total Assets can be defined as the average amount of assets recorded on the company’s balance sheet at the end of two financial years: the current year and the preceding year. Average Total Assets represent the mean of the total wealth of the business during two timelines. This figure …

How to Calculate Average Total Assets? (Definition, Formula, Calculation, Example) Read More »

Dividends can be defined as the share of profits that are paid to the investors or the shareholders of the company in return for their investment in the particular company for a period of time. Since shareholders are technically the owners of the company, they are compensated through a profit-sharing, on an annual, semi-annual, or …

How to Account for Dividends Paid? (Definition, Example, Journal Entry, And More) Read More »

Definition of Accrued Salaries Accrued Salaries are defined as the current liabilities at the end of a given financial period for salaries and/or payroll expenses that have been incurred by the company, but are not yet paid for by the Company. The accrued salaries are debited in the salaries account of the income statement and …

How to Record Accrued Salaries? (Definition, Journal Entries, and Example) Read More »