In this blog, we’ll go beyond the basics and delve into the nuances of accounting ratios. Profitability ratios are crucial for businesses as they help evaluate the financial health and sustainability of the company. By monitoring these ratios, businesses can identify areas where they can improve profitability, control costs, and enhance overall performance. If the […]
Category Archives: Bookkeeping
Companies often refer to the name of the vendor from whom they have made purchases rather than the “Account payable” account when recording financial transactions. Instead of keeping all the balances under a single account, it enables them to manage their Accounts Payable balances more efficiently. Understanding debits and credits and account types is essential […]
A credit memo is also commonly called a credit memorandum, credit note, memorandum of credit, or refund voucher. This document is made when the person selling goods returns money to the person who bought them. It typically occurs when an overpayment has occurred, whether intentionally or due to an error on the part of either […]
Therefore, we should use variable costing when determining whether to accept this special order. Office rent and other general administrative expenses are treated as period costs. Product costs, on the other hand, are capitalized as inventory on the balance sheet. The rent expense is recorded on the income statement each month whether 1,000 units or 10,000 units […]
This way, you can determine which companies come out on top and which ones fall at the bottom. The net profit margin shows whether increases in revenue translate into increased profitability. Net profit includes gross profit (revenue minus cost of goods) while also subtracting operating expenses and all other expenses, such as interest paid on debt […]
You can reduce your carrying costs by minimizing inventory on hand, increasing your inventory turnover, or redesigning your warehouse space. Price, age, MTBF (reliability), and positioning are the four factors they consider when making a purchase. Each market segment has its own set of price expectations. The same outcome can arise when a customer backs […]
The most well-known function of Vitamin K1 in animals is as a blood clotting agent in the liver, where it forms blood clotting factors such as prothrombin (II), VII, IX and X. K-1’s popularity differs greatly among six K-1 regions, which may limit the number of actual elimination tournaments or change locations. K-1 attempted to […]
‘Sales returns’ will reduce the income generated from sales (as some of the customers sent the goods back) so go on the debit side. Purchases are an expense which would go on the debit side of the trial balance. The Source of monetary benefit is credited and the destination account is debited. For every debit […]
You can also scroll through Xero’s default chart of accounts and customize it as needed, or import an already existing chart of accounts. If you have a list of customers and suppliers, you can import that, too. We’re committed to the security of your data and provide multiple layers of protection for the personal and […]
Fourth, Maiden checks the invoice against the purchase order and possibly the dispatch note. The aim is to ensure that the goods were genuinely ordered and have been received. In the business world, credit notes are raised before the bill is paid most of the time, so the amount is taken off the amount paid […]