Recent posts on Accounting

Intangible assets are those identifiable assets which has no physical substance and is not a financial instrument. This means you can not touch it. Intangible assets are disclosed

Company’s balance sheet has three major section: assets, liabilities and owner’s equity. As a general accounting rule, assets must equals liabilities and owner’s equity. It’s known as balance

Every transaction that has a economical impact on the business is recorded in minimum two accounts, once in the debit side of a account and once in the

When a business makes a purchase, depending on certain factors, its either considered as capital expenditure or revenue expenditure. To understand the concept, there are basically two areas

By posting adjusting entries to respective accounts, you prepare adjusted trial balance to derive income statement and balance sheet of the company. After preparing these reports, you need

Adjusting entries are part of accrual concept of accounting. In general, accounting transactions are recorded by following accrual basis of accounting except in few schools, government departments and

Total debit and total credit of every accounting transaction must tally while posting it to the accounting system. In an organisation, accountants across the world post transactions by

One of the basic principles of accrued accounting system is matching revenue with expenses. When a company buys assets such as building, plant and machinery, the cost is

A transaction is an event which has financial impact on the enterprise and requires recording. In other words, transactions are typically involve an exchange of resources between the

Debt to equity ratio shows you how debt is tied up in the owner’s equity. Please note, for this calculation only long term debt/liabilities are considered. Debt is