The accounting postulates are a set of fundamental assumptions and rules that underlie the practice of financial accounting. The postulates are intended to provide a framework for financial reporting that is objective, consistent, and reliable. The four main accounting postulates are: 1. The Economic Entity Assumption: This assumption states that businesses should be treated as … Read more
Quarter-To-Date (QTD) refers to the period of time between the beginning of the current fiscal quarter and the current date. This period of time is typically used to measure the performance of a company or investment over the course of a quarter. What MTD means? MTD stands for “Month-to-Date”. It is used to describe the … Read more
Forensic accounting is the application of accounting principles and techniques to investigate and resolve disputes. Forensic accountants are often retained by attorneys to provide expert testimony in civil and criminal cases. They may also be called upon to investigate fraud, mismanagement, or other financial irregularities. Forensic accountants use their knowledge of accounting and financial principles … Read more
-Absorption Costing: Pros and Cons -Example of How Absorption Costing Works What are the objectives of absorption costing? The main objective of absorption costing is to ensure that all manufacturing costs are included in the cost of each unit produced. This includes both direct costs (e.g. materials and labour) and indirect costs (e.g. overheads). The … Read more
Quarter over quarter (Q/Q) is a comparison of one financial quarter against the previous quarter. Typically, businesses will report Q/Q growth or decline in terms of revenue, earnings, or some other financial metric. Quarter over quarter comparisons are useful in gauging the overall health of a company, as well as its recent performance. For example, … Read more
An accountant’s letter is a formal document that is written by an accountant to another party, typically a client. The letter typically contains information about the accountant’s professional qualifications and experience, as well as their fee structure. What subject are needed for accounting? There are a few different types of accounting, but the most common … Read more
Operating income before depreciation and amortization (OIBDA) is an accounting measure that can be used to assess the profitability of a company before the effects of depreciation and amortization are taken into account. Depreciation and amortization are non-cash expenses that can distort the true picture of a company’s profitability. OIBDA can be calculated by taking … Read more
Working capital, also known as net working capital (NWC), is the difference between a company’s current assets and current liabilities. Current assets include cash and assets that can be quickly converted into cash, such as inventory and accounts receivable. Current liabilities include short-term debt and other obligations that are due within one year. A company’s … Read more
The term “absorbed cost” refers to the total cost of producing a good or service, including both the direct costs (e.g. raw materials and labor) and the indirect costs (e.g. overhead). The term is often used in cost accounting to compare the cost of different production methods or to determine the optimal level of production. … Read more
An accounting manual is a document that contains the guidelines and procedures for financial reporting and accounting. It is typically used by accountants and auditors to ensure that financial statements are prepared in compliance with generally accepted accounting principles (GAAP). What are the 4 types of accounting? 1. Financial Accounting Financial accounting is the process … Read more
