Tag Archives: Balance sheet

What is meant by capital reserve of company?

What is meant by capital reserve of company? A resource created by the accumulated capital surplus (not revenue surplus) of an organization, such as by an upward revaluation of its assets to reflect their current market value after appreciation. Allocating such sums to capital reserve means they are permanently invested and will not be paid as dividends. Source: http://www.businessdictionary.com/definition/capital-reserve.html#ixzz2XxkeFLfh Or …

Read More »

Final Account Important Question 2 for I.Com Part 1

Final Account Important Question 2 for I.Com Part 1 Prepare trading and profit & loss account and balance sheet for the year ended 31 December, 2007  TRIAL BALANCE Debit Drawings                                                                                 650 Debtors                                                                                    26,250 Furniture                                                                               6,900 Wages                                                                                      2,750 Trade expenses                                                                    475 Selling expenses                                                                   250 Office expenses                                                                      500 Opening stock                                                                          2,000 Purchases                                                                                 5,000 Closing stock                                                                           6,000                                                                                                                                                                                                50,775 Credit   Sales                                                                            …

Read More »

Define bills of exchange

Define bills of exchange A written order to pay a sum of money on a given date to the drawer or to a named payee; a promissory note Or A written, unconditional order by one party (the drawer) to another (the drawee) to pay a certain sum, either immediately (a sight bill) or on a fixed date (a term bill), …

Read More »

Define income statement

Define income statement A financial statement that gives operating results for a specific period. Or The income statement is one of the major financial statements used by accountants and business owners. (The other major financial statements are the balance sheet, statement of cash flows, and the statement of stockholders’ equity.) The income statement is sometimes referred to as the profit …

Read More »

Define current assets

Define current assets Cash and other assets that are expected to be converted to cash within a year Or Cash and other resources that are expected to turn to cash or to be used up within one year of the balance sheet date. (If a company’s operating cycle is longer than one year, an item is a current asset if …

Read More »

Define balance sheet

Define balance sheet A financial statement that summarizes a company’s assets, liabilities and shareholders’ equity at a specific point in time. These three balance sheet segments give investors an idea as to what the company owns and owes, as well as the amount invested by the shareholders. The balance sheet must follow the following formula: Assets = Liabilities + Shareholders’ …

Read More »

Define equity

Define equity 1. A stock or any other security representing an ownership interest. 2. On a company’s balance sheet, the amount of the funds contributed by the owners (the stockholders) plus the retained earnings (or losses). Also referred to as “shareholders’ equity”. 3. In the context of margin trading, the value of securities in a margin account minus what has …

Read More »

Define Real Account

Define Real Account Also known as a permanent account. Includes the balance sheet accounts (assets, liabilities, and owner’s or stockholders’ equity accounts) but excludes the owner’s drawing account, which is a temporary account. Source: http://www.accountingcoach.com/terms/R/real-account.html Or Assets, liability, reserve, and capital accounts that appear on a balance sheet. The balances of real accounts are not cancelled out at the end …

Read More »

What is Accounting Period?

What is Accounting Period? Period for which a firm prepares its internal or external accounts; the period covered by the financial statements. For internal accounts, it may be a month or a quarter; for external accounts it is normally a period of 12 months. Source: http://www.businessdictionary.com/definition/accounting-period.html#ixzz2XFdXDPWT Or The time span in which certain financial events took place. The accounting period …

Read More »

Objective Type Questions for Principle of Accounting I.Com Part 1 (k)

Objective Type Questions for Principle of Accounting I.Com Part 1 (k)

Read More »
Copy Protected by Chetan's WP-Copyprotect.