Tag Archives: income statement

Financial Accounting II Notes

Financial Accounting II Notes Click on your required topic: Types of Business Entities Formation of Companies and Meetings Relationships between Companies Preparation and Presentation of Financial statements Property, Plant and Equipment Revaluation of Assets Property, Plant & Equipment and Borrowing Cost  Intangible Assets – Companies Ordinance 1984 Intangible Assets – IAS 38 & Investment in Associates Other Non Current Assets …

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Objective Type Questions for Principle of Commerce I.Com Part 1 (j)

Objective Type Questions for Principle of Commerce I.Com Part 1 (j)

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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                                                                            …

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What is the difference between capital expenditure and revenue expenditure?

What is the difference between capital expenditure and revenue expenditure? Revenue expenses are costs in the four day to day running of the business for example servicing a machine, spare parts etc. Revenue expenditure is normally charged against profit in the Income statement in the year it is expensed. Capital expenditure is on an item that will help generate profits …

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What is profit & loss statement?

What is profit & loss statement? A financial statement that summarizes the revenues, costs and expenses incurred during a specific period of time – usually a fiscal quarter or year. These records provide information that shows the ability of a company to generate profit by increasing revenue and reducing costs. The P&L statement is also known as a “statement of …

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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), …

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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 …

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Define the term provision

Define the term provision PROVISION, generally, is to prepare in advance for an event that is projected to take place in the future. In accounting, it is an amount charged against profits for a specific liability (for example: bad debts, depreciation or taxes). A liability may be known, but the amount is often uncertain. This uncertainty may lead to an …

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Define prepaid expenses

Define prepaid expenses Accounting term signifying money paid for goods or services upfront. A prepaid expense is considered an asset on the balance sheet. As the goods and services are delivered they are recorded on the income statement. An example of a prepaid expense is insurance, since the policy holder pays money upfront to cover the risk of possible damaging …

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Define Drawing

Define Drawing The withdrawal of business cash or other assets by the owner for the personal use of the owner. Withdrawals of cash by the owner are recorded with a debit to the owner’s drawing account and a credit to the cash account. Source: http://www.accountingcoach.com/terms/D/draw.html Or We use drawing many times in financial accounting. Drawing here means any amount withdraws …

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