1. Balance sheet has only one capital account 2. Profit (or loss) added (or subtracted) to capital account (in balance sheet)3. Net assets and total equity has to tally ($14,200)3. The profit is from the income statement4. Note that the title is “Statement of Financial Position as at ….” because the value of the assets / liabilities …
Partnership Statement Profit and loss is split according to original capital contributions or as agreed Profit and loss is after deduction of the salary owed to the partners (partners are usually paid salary if they are active in the business or as per agreed in the partnership agreement) No taxation is shown Difference between partnership …
Partnership Statement of Financial Position There is a capital account and current account for each partner Partners’ equity accounts may be totalled together with original contribution or separated as in this example. In this example, there are 3 current accounts showing the total received from the business by each partner. The 3 capital accounts …
The profit after tax can be either: (1) distributed to shareholders as dividends or(2) retained in the companies for future growth as retained earnings or retained profits In this case, we can see that even though the profit after tax was $53 550, only $48 550 is shown as retained earnings.The difference has probably …
1. Integrity· Be straightforward, honest and sincere in your approach to professional work. 2. Objectivity· Not to compromise their professional or business judgment because of bias, conflict of interest or the undue influence of others.· Be fair and do not allow prejudice, conflict of interest or bias to override your objectivity. 3. Competence …
Assets = Liabilities + Owner’s Equity A = L + OEWhat you owned = What you owed + What you haveImagine you want to buy a Ferrari Sports Car that costs $500,000. You save up for 2 years and you have gotten $280,000. Hence, you borrowed $220,000 from your parents to pay for the car. …
> Every business transaction has a dual transaction> Business transactions are analysed by examining the dual effects of each business transaction (Debit and Credit) the impact on the accounting equation (Assets, Liabilities and Owner’s Equity) Example: A firm borrows cash to purchase a car Borrowing increases asset(cash) and also your liabilities (loan) Purchasing a car …
Recall from our last post that: Assets = Liabilities + Owner’s Equity Debit Nature = Credit Nature + Credit Nature Therefore, this leads to the concept of double journal entries for every transaction:Example: I injected $300,000 cash and borrowed $200,000 from the bank to set up a business, ABC Pty Ltd Step 1:Identify the A, L …
They are stock that are repurchased back by the company that issued them. This act reduces the number of stocks outstanding in the market and hence increases the earnings per share and return on equity Having issues with your accounting module? SMS us at +65 9758-7925 or email: enquiry@starcresto.com
The behaviour of costs can be classified as fixed or variable Cost behaviour is linear Fixed costs remain ‘fixed’ over the time period and/or a given range of activity (often referred to as the relevant range) Unit price and cost data remain constant over the time period and relevant range For multi-product entities, the sales …