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q what is inventory obsolescenceinventory obsolescence -- inventory no longer salable possibly there is too much on handpossible it is out of fashion
q what is inventoryinventory -- supply or stock of products and goods that a company has for sale amanufacturer may have 3 kinds of inventory raw
q what do you understand by goodwillgoodwill -- in accounting difference between what a company pay when it buys theassets of another company and
q what is fixed costfixed cost -- a cost that doesnt change as sales volume changes in the short run fixedcosts generally include such items as rent
q describe about expenseexpense -- an expenditure that is chargeable against revenue during an accounting periodan expense leads to the reduction of
q what do you eman by expenditureexpenditure -- an expenditure takes place when something is attained for a business -- an asset isbought salaries
80 - 20 rule - a common rule of thumb in business which says that 20 of the items produce80 of the action -- 20 of product line produces 80 of the
q what is depreciationdepreciation -- an expense which is supposed to reflect the loss in value of a fixed asset forinstance if a machine will
q what do you understand by deferred incomedeferred income -- a liability which arises when a company is paid in advance for services orgoods that
credit -- an accounting entry on the bottom or right of a balance sheet generally an increase inliabilities or capital or a reduction in assets
q describe the cost of salescost of sales cost of goods sold -- expense or cost of all items sold during an accountingperiod every unit sold has a
q what do you mean by contingent liabilitiescontingent liabilities -- liabilities which are not recorded on a companys financial reports though
q show the chart of accountschart of accounts -- a listing of all accounts or categories into that businesstransactions would be classified and
q what do you mean by capitalizecapitalize -- to capitalize means to record an expenditure on balance sheet as an assetto be amortized over the
q describe about capitalcapital -- money invested in a business by its owners on the right side or bottom of a balance sheet capital also denotes to
q what do you mean by breakeven pointbreakeven point -- the amount of revenue from sales that exactly equals the amount ofexpense breakeven point is
q why we need book valuebook value -- total assets minus total liabilities book value also meansvalue of an asset as recorded on the companys
q what is the use of balance sheetbalance sheet -- a statement of the financial position of a company at a single specific timeoften at the close of
q what are bad debtsbad debts -- amounts owed to a company which arent going to be paid an accountreceivable becomes a bad debt when its recognized
q what is intangible assetsintangible assets are items likecopyrights patents licenses trademarks franchises andother kinds of rights or things of
q describe about fixed assetsfixed assets cant be quickly turned into cash without interfering with business operationsfixed assets comprise
q explain about amortizeamortize -- to charge a regular part of an expenditure over a fixed period of time forinstance if something cost 100 and is
q what do you mean by agingaging -- a process where accounts receivable are sorted out by age typically current 30 to60 days old 60 to 120 days old
q what is accrued expensesaccrued expenses accruals -- an expense that has been incurred though not yet paid forsalaries are a good instance
q what is accounting systemaccrual basis system or method -- an accounting system which records revenues andexpenses at the time when transaction