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Knowing the linkage of numbers in a financial statements set is vital to anyone who attempts to understand the content of financial statements and accounting in...
In general, an income statement summarizes revenues and expenses and gains and losses, and ends with the net income for a specific period. However, to comprehend...
A company’s financial statements are invaluable for investors. Using the financial statements alone you can determine the health of the company and make educated predictions about...
The objective of financial statements is to provide information for economic decisions. A complete set of financial statements comprises a balance sheet, income statement, statement of...
DIVIDEND PAYOUT RATIO – This ratio is computed by dividing total cash dividends for the year by the net income for the year. It’s simply the...
Most business publish three financial statements, usually annually but sometimes more frequently. These are the profit and loss account (income statement), the balance sheet and the...
This post tackles two basic questions about “Analyzing Profit Behavior”: How did the business make its profit? How can the business improve its profit performance?. Business...
At the end of every accounting period certain accounts are closed and others remain open. This post is softly trying to remind you with some essential...
There are several tools used to conduct financial analysis. One is a database of accounting information, in which an analyst can roam for days, tracking down...
After a business decides on the format for reporting its income statement (multi-step or single-step), the next main decision concerns how much information to disclose about...
Businesses keep two types of account; Real Accounts and Nominal Accounts. What is Real Account? What is Nominal Account? The following explanations may deliver easier understanding for you....
The guts of an annual financial report are the three primary financial statements are briefly explained below: Income Statement: This is the summary of a company’s...
We can use several tools to evaluate a company, but some of the most valuable are “financial ratios“. Ratios are an analyst’s microscope: they allow us...
BALANCE SHEET Each framework requires prominent presentation of a balance sheet as a primary statement. Format IFRS: Entities present current and non-current assets, and current...