Month: November 2020

An activity is an event, task or unit of work with a specified purpose e.g., designing products, setting up machines, operating machines and distributing products. Next, we discuss the methods used for activity-based costing and illustrate them with an example. Step 4 then requires us to use the costs per unit of cost driver to… Continue reading Activity-based costing F5 Performance Management ACCA Qualification Students

Content Challenges of ABC examples of activity-based costing More articles on P&L Management Unit Cost Card Using Labor Approach Advantages and Disadvantages of Activity Based Costing Finally, ABC alters the nature of several indirect costs, making costs previously considered indirect—such as depreciation, utilities, or salaries—traceable to certain activities. Alternatively, ABC transfers overhead costs from high-volume… Continue reading What is Activity-Based Costing?

Content What Are the Consequences of Overstating Your Accounts Receivable? Calculating Retained Earnings Tracking the Debt Breaking Down the Debt Impact of Retained Losses on Investment Decisions Incorporation laws often prohibit companies from paying dividends before they can eliminate any deficit in retained earnings. If the retained earnings account is in the red, it’s known… Continue reading Retained loss definition

Therefore the accrual to cash conversion is the difference between current year receivables/payables and prior year receivables/payables. The accrual method of accounting is the method in https://www.bookstime.com/articles/stale-dated-checks which income is recognized when it is earned and expenses are recognized when they are incurred regardless if cash was exchanged. Below are several key terms used with… Continue reading How to convert cash basis to accrual basis accounting