Accounting Category: Income statement

Accounting Articles

March 8, 2014

In this series of articles, we will discuss the different types of financial statements required of a corporation by US GAAP and the different reports required of public companies by the Securities and Exchange Commission. For this part 1, we will give a brief overview of the major financial statements produced by a corporation - balance sheet, income statement, statement of shareholders’ equity, cash flow statement and related footnotes.

February 15, 2014

Long gone are the days where large companies only sell products in one country. The growth of the global economy has provided many opportunities for growth, but that growth has brought with it unique accounting challenges. In this article, we’ll describe several common issues associated with accounting for transactions in foreign currencies.

February 9, 2014

Most articles on this site deal with companies that operate for profit. In this article, we discuss a few differences encountered when accounting for companies that have non-for-profit purposes.

February 3, 2014

In the last article, we discussed partner capital accounts, contributions, and withdrawals, as well as the allocation of periodic income. Now we’ll look at how to account for the termination of a partnership.

January 26, 2014

Many of the accounting principles on this website apply to any type of company. In this series of articles, we focus on the basics of accounting for partnerships, a business entity formed by two or more owners that is less structured than a corporation.

January 18, 2014

Company managers need to keep track of costs in order to make wise decisions about day-to-day operations. In this article, we discuss process costing, a method of allocating costs for manufacturers of many identical products.

October 31, 2013

Companies often provide warranties to their customers. There may be standard warranties and extended warranties. Standard warranties are provided when a product is sold and may cover periods from a few months to multiple years. Extended warranties usually require a separate payment and cover periods in addition or after standard warranties. Companies need to account for standard and extended warranties appropriately. We will discuss such accounting in this article.

October 17, 2012

Budgeting is important for any organization. Preparing a master budget requires preparing financial budgets as well as an operating budget, which in turn consists of many components such as sales budget, production budget, costs of goods sold budget, etc. In this article we will learn to prepare a simple production budget, which is an important component of the operating budget. Production budget is used to prepare other components of the operating budget, including direct materials purchases budget, direct labor budget, etc.

August 29, 2012

Do you normally just look at the net income of a company? Do you analyze the company's cash flows from operations? See how the two are connected in this article discussing the quality of income.

August 5, 2012

What do investing and financing activities and related cash flows represent? How are they different? Why are non-cash activities presented as part of the cash flow statement? Answers to these questions are available in this article.

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Accounting Categories
Accounting categories represent a collection of accounting guides and answers related to one accounting area.