What is an example of double-entry bookkeeping? What is revenue expenditure in accounting? What is nonmanufacturing cost in accounting? What is an insurance expense in a financial statement in accounting? What is accrual accounting? Under what circumstances do we record an accounting entry?
Give an example of each.Expenditure:Expenditure is the amount spent by the organization and is classified into revenue and capital expenditures. Capital expenditure helps to improve the earning capacity while revenue expenditure helps to maintain the earning capacity of the organi...
Comparable to the mechanics of a depreciation schedule, i.e. the actual cash outflow is not recognized in the period the capital expenditure (Capex) was incurred, but rather spread across its useful life. The prepaid expense asset incrementally declines until the balance eventually reaches zero. ...
Unearned Revenues:Unearned revenues are the advances received from the customers to whom the goods & services are yet to be supplied. An example of unearned revenue is one company pays $50 as advance while giving the order for goods to the supplier but the goods are to be delivered after 1...
In July 2012, a loan of $30 million with an interest rate of 4% was negotiated with Grohl Co’s bank, the main purpose of the loan being to fund the capital expenditure necessary for the new production line. $2·5 million of the loan represents an overdraft which was converted into ...
Accrued expenses can be forecasted as a percentage of SG&A, but in this case, the type of expenses (and size) makes using revenue as the driver more preferable. Deferred Revenue → Deferred Revenue % Sales Deferred revenue is “unearned” revenue where the cash payment was received before the...
Based on past experience, the company assumes the annual replacement capital expenditure of CU 500 each year net of the inflation effect. Fixed costs are the same in real terms (hint: careful about the inflation!). They exclude depreciation and amortization. ...
Cost centers are used to logically allocate revenues and expenditure that result from ongoing activities, for the purpose of determining profit and loss. cost of goods manufactured Sum of the material and production costs incurred in the production of a material. costing code The code of a ...
Muslim banks have undergone difficulty in executing the no-interest policy in low yield investments, projects that span over long periods of time, financing small businesses and financing government expenditure. This has resulted in limited financing in these areas by Muslim banks as the returns and...
Give an example of each.ExpenditureExpenditure refers to the money expended to compensate for the cost of goods or services procured. Generally, the expenses are a reflection of the reduction from income. Sometimes the expenditure is also added to the value of ...