Retailers’ normal operating activities would include the purchase and sale of merchandise and selling and administrative expenses. A retailer’s investing of its idle cash is a nonoperating activity. However,...
Retailers’ normal operating activities would include the purchase and sale of merchandise and selling and administrative expenses. A retailer’s investing of its idle cash is a nonoperating activity. However,...
The activities involved in earning revenues. For example, the purchase or manufacturing of merchandise and the sale of the merchandise including marketing and administration. In the statement of cash flows the operating...
The first section of the statement of cash flows. To learn more, see Explanation of Cash Flow Statement.
What is cash from operating activities? Author: Harold Averkamp, CPA, MBA Definition of Cash from Operating Activities Cash from operating activities usually refers to the first section of the statement of cash flows....
The first major section of the statement of cash flows. To learn more, see Explanation of Cash Flow Statement.
will report sales of merchandise of $5,000 and cost of goods sold of $3,000. The difference of $2,000 is part of the retailer’s gross profit, operating income, and net income. The word “gain” is not appropriate...
The debit or credit balance that would be expected in a specific account in the general ledger. For example, asset accounts and expense accounts normally have debit balances. Revenues, liabilities, and...
The actual cost of direct materials, the actual cost of direct labor, and manufacturing overhead applied by using a predetermined annual overhead rate.
Spoilage or waste that is likely to occur and cannot be avoided at a reasonable cost.
as an operating expense on the company’s income statement. It may be included in the company’s selling, general and administrative expenses. [However, if the expense is associated with extending credit outside of a...
): Operating Activities Investing Activities Financing Activities Supplemental Disclosures For items 1-18, indicate which part will be affected. 1. Depreciation Expense. Operating Right! Depreciation is added back to net...
Our Explanation of Working Capital and Liquidity provides you with an in-depth look at the components of working capital and the challenges of converting current assets to cash before obligations come due. You will see...
Since our Explanation of Cash Flow Statement illustrates how the amounts are determined, you will get a better understanding of this very important financial statement. No longer will you look at only the income...
Our Explanation of Working Capital and Liquidity provides you with an in-depth look at the components of working capital and the challenges of converting current assets to cash before obligations come due. You will see...
Our Explanation of Bookkeeping provides you with a rich understanding of the recording of transactions. It then discusses the additional steps necessary for preparing accurate financial statements. This is great for...
income earned by most companies is considered to be nonoperating income or other income. (However, banks and other lenders, whose primary activities involve earning interest, will report their interest earned as part of...
Financial Statements Video Training Download Video Download Audio Author: Harold Averkamp, CPA, MBA Part 13 Statement of cash flows: cash flows from operating activities, cash flows from investing activities, cash flows...
Financial Statements Video Training Download Video Download Audio Author: Harold Averkamp, CPA, MBA Part 13 Statement of cash flows: cash flows from operating activities, cash flows from investing activities, cash flows...
Financial Statements Video Training Download Video Download Audio Author: Harold Averkamp, CPA, MBA Part 13 Statement of cash flows: cash flows from operating activities, cash flows from investing activities, cash flows...
Financial Statements Video Training Download Video Download Audio Author: Harold Averkamp, CPA, MBA Part 13 Statement of cash flows: cash flows from operating activities, cash flows from investing activities, cash flows...
Financial Statements Video Training Download Video Download Audio Author: Harold Averkamp, CPA, MBA Part 13 Statement of cash flows: cash flows from operating activities, cash flows from investing activities, cash flows...
: introduction, cash flows from operating activities Part 13 (11:16) Statement of cash flows: cash flows from operating activities, cash flows from investing activities, cash flows from financing activities, quality of...
Our Explanation of Income Statement helps you learn the most important features of a corporation's income statement (also known as the statement of operations or profit and loss statement). We provide more understanding...
) under the accrual basis of accounting. Reporting Interest on a Note Payable on the Cash Flow Statement The interest paid on a note payable is reported in the section of the cash flow statement entitled cash flows from...
of cash flows (SCF) involves the cash flows from operating activities. (There are no differences in the cash flows from investing activities and/or the cash flows from financing activities.) Under the U.S....
The average time it takes for a retailer’s or manufacturer’s inventory to turn to cash. If a manufacturer turns its inventory six times per year (every two months) and allows customers to pay in 30 days, its...
What is operating income? Author: Harold Averkamp, CPA, MBA Definition of Operating Income Operating income is defined as a corporation’s operating revenues minus its operating expenses. Operating income will be shown...
A company’s profit before nonoperating or other items. Other or nonoperating items include interest income, interest expense, and gains and losses on sale of assets used in the business, loss on lawsuit, etc.
A rental agreement where ownership is not intended. An operating lease is not recorded in the general ledger accounts and therefore the asset and liability will not appear on the balance sheet. A lease that in substance...
Operating expenses are the costs of a company’s main operations that have been used up during the period indicated on the income statement. For example, a retailer’s operating expenses consist of its cost of...
What is the operating cycle? Author: Harold Averkamp, CPA, MBA Operating cycle definition The operating cycle is the time required for a company’s cash to be put into its operations and then return to the company’s...
A company’s loss before nonoperating or other items. Other or nonoperating items include interest income, interest expense, and gains and losses on sale of assets used in the business, loss on lawsuit, etc.
Is depreciation an operating expense? Author: Harold Averkamp, CPA, MBA Depreciation Could Be Either an Operating Expense or a Non-operating Expense Depreciation is an operating expense if the asset being depreciated is...
What are operating expenses? Author: Harold Averkamp, CPA, MBA Definition of Operating Expenses Operating expenses are the costs that have been used up (expired) as part of a company’s main operating activities during...
Our Explanation of Financial Ratios includes calculations and descriptions of 15 financial ratios. As you calculate the financial ratios you will also gain a deeper understanding of a company's operations and financial...
Our Explanation of Income Statement helps you learn the most important features of a corporation's income statement (also known as the statement of operations or profit and loss statement). We provide more understanding...
A credit is not a normal balance for what accounts? Author: Harold Averkamp, CPA, MBA Definition of Credit Balance A credit balance refers to the balance on the right side of a general ledger account or T-account....
For a retailer, wholesaler, and distributor the primary activities would be the buying of merchandise and then the sale of that merchandise. A manufacturer’s primary activities would be the production and sale of...
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