ACCOUNTING PRINCIPLES
A ccounting principles is the rules and guidelines that companies must follow when reporting financial data. The common set of accounting principles is the generally accepted accounting principles (GAAP). To remain listed on many major stock exchanges in the U.S. companies must file regular financial statements reported according to GAAP. Accounting principles differ around the world and countries usually have their own, slightly different, versions of GAAP.
Since accounting principles differ a cross the world, investors should be aware of these differences and account for them when comparing come panies in different countries. The problem of differences in accounting principles does not much affect mature markets. Still, investors should be careful, since is still leeway for the distortion of numbers under many sets of accounting principles.
Wednesday, March 27, 2013
DEFINITION of ACCOUNTING
Accountancy, or accounting is the production of in information about an enterprise and the transmission of that information from those who have it to those who need it. The comunication is generally in the form of financial statements that show in money terms the economic resources under the control of management, the art lies in selecting the information that is relevan to the user and is representationally faithful. The principles of accountancy are applied to businees entities in three divisions of practical art, named accounting, bookeeping, and auditing.
The Ameican Institute of Certified Public Accountants ( AICPA) defines accountancy as "...the art of recording, classifying, and summarizing in a significant manner and in terms of money..." transactions and events that are at least partly financial in character, and interpreting the result.
Accountancy, or accounting is the production of in information about an enterprise and the transmission of that information from those who have it to those who need it. The comunication is generally in the form of financial statements that show in money terms the economic resources under the control of management, the art lies in selecting the information that is relevan to the user and is representationally faithful. The principles of accountancy are applied to businees entities in three divisions of practical art, named accounting, bookeeping, and auditing.
The Ameican Institute of Certified Public Accountants ( AICPA) defines accountancy as "...the art of recording, classifying, and summarizing in a significant manner and in terms of money..." transactions and events that are at least partly financial in character, and interpreting the result.
Monday, March 25, 2013
FOB Shipping point
Term indicating that the buyer must pay to get the goods delivered. (The buyer will record freight-in and the seller will not have any delivery expense.) With terms of FOB shipping point the title to the goods usually passes to the buyer at the shipping point. This means that goods in transit should be reported as a purchase and as inventory by the buyer. The seller should report a sale and an increase in accounts receivable.
FOB Destination Point
Fob destination point is impliess that the seller owns the goods in transit and is responsible for freight charges and assist with the settlement of claims and is responsible for full replacement of damaged items.
Point on Sale
Point on sale is the place where a retail transaction is completed. It is the point at which a customer makes a payment to a merchant in exchange for goods or services. At the point of sale the merchant would use any of a range of possible methods to calculate the amount owing - such as manual system, weighing machines, scanners or an electronic cash register. The merchant will usually provide hardware and options for use by the customer make payment - such as an EFTPOS terminal. The merchant will also normally issue a receipt for the transaction.
Term indicating that the buyer must pay to get the goods delivered. (The buyer will record freight-in and the seller will not have any delivery expense.) With terms of FOB shipping point the title to the goods usually passes to the buyer at the shipping point. This means that goods in transit should be reported as a purchase and as inventory by the buyer. The seller should report a sale and an increase in accounts receivable.
FOB Destination Point
Fob destination point is impliess that the seller owns the goods in transit and is responsible for freight charges and assist with the settlement of claims and is responsible for full replacement of damaged items.
Point on Sale
Point on sale is the place where a retail transaction is completed. It is the point at which a customer makes a payment to a merchant in exchange for goods or services. At the point of sale the merchant would use any of a range of possible methods to calculate the amount owing - such as manual system, weighing machines, scanners or an electronic cash register. The merchant will usually provide hardware and options for use by the customer make payment - such as an EFTPOS terminal. The merchant will also normally issue a receipt for the transaction.
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