Finance

Asset held with the intention of being used for the purpose of producing goods or providing services and is not held for sale in the normal course of business is known as fixed assets.Fixed assets are shown on the balance sheet at its historical cost less accumulated depreciation.Cost of fixed assetsCost of fixed asset is the purchase price and any thing that is … [Read more...] about Fixed assets on the company’s balance sheet

Financial accounting is a major source of information for success of business. Most important aspect of financial accounting system is referred to as recognition, it's the decision about when to record revenue and expense transactions. We have two type of accounting used to record transactions, cash and accrual.In this article, we will be discussing both cash and accrual … [Read more...] about Cash vs Accrual basis of accounting – which on is better

Balance sheet has three components, assets, liabilities and owner's equity. One of the section under the component liability is “current liability”.Current liabilities are obligations that is due and payable within 12 months from the date of balance sheet or within one operating cycle, whichever is longer.In balance sheet, under the current liability section company … [Read more...] about Understanding Current liabilities on the balance sheet

When you look at the asset side of company’s balance sheet, you will find a category at the end of the balance sheet called current asset. It will let you know the liquid capital the company has to pay its current liabilities. This means, it will tell you how much money is available with the company for business immediately.Under current assets, you will find those assets … [Read more...] about Current asset on the balance sheet

When you’re looking into a company’s financial health, one of the most important documents to check is the cash flow statement. It gives you a clear picture of how cash moves in and out of the company, helping to assess whether the company can pay its bills, invest in growth, and survive financially.In this article, we will break down the concept of a cash flow statement in … [Read more...] about Understanding the Cash Flow Statement: A Beginner’s Guide to Company Liquidity