Typically, interest expenses arise from a company borrowing money, for example, through a business loan, line of credit, or credit card. Interest expense is the total interest payment you make to creditors for a specific period on your P&L statement. The general form of the statement is a line item for revenue, known as the […]
As a result, the prime cost calculation can be misleading if indirect costs are relatively large. A company likely incurs several other expenses that would not be included in the calculation of the prime cost, such as manager salaries or expenses for additional supplies needed to keep the factory running. These other expenses are considered
Utilitarianism suggests that an ethical action is one whose consequence achieves the greatest good for the greatest number of people. So, if we want to make an ethical decision, we should ask ourselves who is helped and who is harmed by it. Focusing on consequences in this way generally does not require us to take
Businesses will consider opportunity cost as they make decisions about production, time management, and capital allocation. Financial analysts use financial modeling to evaluate the opportunity cost of alternative investments. By building a DCF model in Excel, the analyst is able to compare different projects and assess which closing entries closing procedure is most attractive. Opportunity
If the actual loss is higher than the estimation, it means the company underestimates the inventory reserve. When we recognize inventory loss, we need to credit inventory and debit inventory reserve. But as the actual loss is higher so the amount of inventory that needs to be credited is higher than the inventory reserve available.
The first schedule to develop is the sales budget, which is based on the sales forecast. The sales budget is not usually the same as the sales forecast but is adjusted based on managerial judgment and other data. Once you a master budget consists of have sales projections down, many of the other budgets fall