## Income statement or Profit & loss account in financial statements

To present financial position for a period to public, companies prepare financial statements. It has four main parts, the balance sheet, income statement, cash flow and retained earnings

## What is Operating cycle of a business

In a business, operating cycle is the average number of days a company takes to put cash into the business operation and then convert it back to cash.

## How cost of goods sold or COGS is calculated

Cost of goods sold is shown in the income statement of a company which is into manufacturing, wholesaling, retailing and into similar kind of business. Cost of goods

## What is Shareholders’ equity on the balance sheet

A company’s balance sheet has three major sections, assets, liabilities and stockholders’ equity or owner’s capital. Liability represents the total debt of the company and owner’s capital represents

## Accounts payable on the balance sheet

Accounts payable is the amount that the company owes to its creditors or outsiders from whom it has brought goods or services. Total amount of accounts payable as

## Beginner’s Guide to Reading and Understanding Assets on the Balance Sheet

On the balance sheet you have three major components, assets, liabilities and owner’s equity. In this article, we will understand the term asset and its components. An asset

## How to calculate Working capital

Working capital is the difference between company’s total current asset and the total current liabilities. In simplified terms, It’s the amount of current asset that is left out

## Fixed assets on the company’s balance sheet

Asset held with the intention of being used for the purpose of producing goods or providing services and is not held for sale in the normal course of

## Accounts receivable on the balance sheet

Accounts receivable for a company means the total money that is due from customers to which it sold goods or services on credit If a company has sold

## Cash vs Accrual basis of accounting – which on is better

Accounting is a major source of information vital for success of business. We have two type of accounting used to record transactions, cash and accrual. In this article,