Financial Accounting

Account receivable is classified as an asset because it is the amount that the company will receive on behalf of the services that it has provided.

When a company provides its services or delivers its goods before the payment is received is called accrued revenue.

Under the revenue recognition principle, revenue is recognized when itโ€™s earned, not when cash is received.

Modified accrual accounting recognizes revenues only when measurable and available. And recognize expenses when they incur.

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.

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 organizationโ€™s net cash flow

๐’๐ก๐จ๐ฎ๐ฅ๐ ๐ˆ ๐ฎ๐ฌ๐ž ๐œ๐š๐ฌ๐ก-๐›๐š๐ฌ๐ข๐ฌ ๐จ๐ซ ๐š๐œ๐œ๐ซ๐ฎ๐š๐ฅ ๐š๐œ๐œ๐จ๐ฎ๐ง๐ญ๐ข๐ง๐ ? Cash basis vs accrual basis accounting?ย Ahh! Confusing- what are they? Why and how Cash basis accounting is different from accrual basis accounting? Which is the most appropriate accounting method- cash accounting or Accrual Accounting?ย  Looking for the answers to these complicated questions? Then you are at the right …

๐’๐ก๐จ๐ฎ๐ฅ๐ ๐ˆ ๐ฎ๐ฌ๐ž ๐œ๐š๐ฌ๐ก-๐›๐š๐ฌ๐ข๐ฌ ๐จ๐ซ ๐š๐œ๐œ๐ซ๐ฎ๐š๐ฅ ๐š๐œ๐œ๐จ๐ฎ๐ง๐ญ๐ข๐ง๐ ? Read More »

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.

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