What is ABC Analysis?
ABC analysis is one of the known inventory classification methods available in which inventory is categorized in three classes A, B and C where A being most important, B being important and C being...
How interest and dividends are disclosed in statement of cash flows?
This often confuse students who are studying Statement of Cash Flows that what is the correct way of disclosing or presenting interest paid or received and dividends paid or received during the period. Many...
What is NIFO inventory valuation method?
NIFO - Next in, First out is an inventory valuation technique in which issues to the production hall are valued at the current market price i.e. current cost or replacement cost instead of the...
What type of accounts are maintained under Purchases ledger?
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What type of accounts are maintained under Purchases ledger? What entries are posted in purchase ledger? Also what is the difference between purchases ledger and purchases account?
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Why amortisation of goodwill is not permissible?
Before IFRS 3 was introduced, entities were allowed to amortize goodwill. However, after it was introduced back in 2004-2005, amortization of goodwill was strictly prohibited and entities were required to follow impairment regime. As...
What is Imputed cost?
Imputed cost mostly termed as opportunity cost or implicit cost is a more technical aspect of economic theory (economic problem).
According to economic theory due to scarce resources investor cannot fulfill all what he wants...
What is HIFO?
HIFO is an acronym for Highest in, First out.
This inventory valuation method assumes that inventory with highest bought in value i.e. highest purchase price in the stock will be consumed first or in other...
What is the difference between Cash basis and Accrual basis accounting and which one...
Accrual basis of accounting is one of the underlying assumption for preparing financial statements under International Accounting Standards. IASB Framework clearly demanded the financial statements to be prepared on accrual basis instead of cash basis...
What is the difference between Negative assurance, Positive assurance, Negative opinion and Negative report?
Difference between Negative assurance and Positive assurance
Many students get confuse in these things and mostly it is because books usually use such terminologies which prevail in the business world which are most of the...
What is Common Size Income Statement?
Common size income statement is an income statement in which each item is reported as a percentage of revenue (also known as turnover or sales).This technique i.e. to express quantities as a percentage of...