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Funds produced from operations, throughout an accounting period, raise working capital by an equivalent amount. The two major components of funds generated from operations are depreciation and profit. Working capital will rise along with the extent of funds produced from operations.
The other source of short-term funds the same in character to trade credit is the credit supplied through the tax authorities. This is produced by the interval which lapses among the earning of the profits through the company and the payment of the taxes due on them.
What is traditional costing In traditional costing overheads are first related to cost centers (production and service centres) and then to cost object, i.e. production. ABC o
how to prepare master budget
Product life cycle Every product has a life cycle. The life cycle of a product vary from months to various years. For example in the case of cameras photocopying machines etc.
Given budgeted figures and actual, then analyses each fixed cost into its components
Advantages of incremental budgeting a) The budget is stable and change is gradual b) Managers can operate their departments on a steady basis c) The system is relatively
Break even analysis and target profit, taxes - Patterson Parkas Company's sales revenue is $30 per unit, variable costs are $19.50 per unit, and fixed costs are $147,000. a)Compute
Steps of choosing an accounting based performance measure Consider the overall goal of the organization as a whole. It is important to choose a measure of accomplishment that r
1. In common, accounting period is the time period reflected by a series of financial statements. 2. In terms of taxation, it is twelve-month period a taxpayer uses to know
Alternative performance measures There are various measures that can be used to measure performance of a decentralized company. The major ones are: • Return on Investmen
Explain Profitability ratios in relation to sales a) Gross profit ratio b) Net profit ratio c) Operating ratio d) Operating profit ratio e) Expenses ratio
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