When an asset losses its value or there is a reduction in its market value, this reduction in value is referred to as Asset Impairment.

A contra account reduces the balance of its associated account and also recognizes the reason for reducing it.

A suspense account is used for an unidentified transaction. As soon as that it becomes identified, record them in their respective accounts.

Is Petty Cash An Expense Account or Asset Account? Petty Cash is not an expense account, it is an asset account.

Free Cash flow & Cash flow. FCF is used for the valuation of an enterprise while CF is used to calculate an organization’s net cash flow

Cash Book Vs Cash Account: Cash book is a separate book, while cash account is an account within ledger to record cash transaction.

𝐓𝐲𝐩𝐞𝐬 𝐨𝐟 𝐖𝐨𝐫𝐤𝐢𝐧𝐠 𝐂𝐚𝐩𝐢𝐭𝐚𝐥- 𝐆𝐫𝐨𝐬𝐬 𝐯𝐬 𝐍𝐞𝐭 𝐖𝐂, 𝐏𝐞𝐫𝐦𝐚𝐧𝐞𝐧𝐭 𝐯𝐬 𝐓𝐞𝐦𝐩𝐨𝐫𝐚𝐫𝐲 𝐖𝐂 Looking puzzled! Why there are too many different types of …

𝐒𝐡𝐨𝐮𝐥𝐝 𝐈 𝐮𝐬𝐞 𝐜𝐚𝐬𝐡-𝐛𝐚𝐬𝐢𝐬 𝐨𝐫 𝐚𝐜𝐜𝐫𝐮𝐚𝐥 𝐚𝐜𝐜𝐨𝐮𝐧𝐭𝐢𝐧𝐠? Cash basis vs accrual basis accounting? Ahh! Confusing- what are they? Why and how Cash basis …

Accrual accounting is an accounting method that records revenues and expenses when they incur- same accounting period.

Cash Accounting method only considers two kinds of transactions- cash inflows & outflows. It doesn't recognize any payables, and receivables.

Three methods of preparing Cash Budget: 1.Receipt and payment method 2.Adjusted profit & loss method/Cash Flow Method 3.Balance Sheet Method.

Four easy steps to prepare cash budget: Define the period, Decide the desired cash position, estimate cash inflows outflows.

Calculate cash conversion cycle in 3Steps. Step#1 Calculate Avg. Inventory, A/R and A/P. Step#2 Calculate DIO, DSO, DPO. Step#3 Calculate CCC.

Free Cash Flow (FCF) indicates that a company is financially sound, and it has the ability to grow and pay its debts and dividends.

The "impact" relates to how the cash flow has changed when there is positive and negative fluctuation in working capital.