Startups

The high-low method is ultimately used to identify incurred costs that change from one period to the next and other costs that occur at the same time and rate each period. It compares the highest and lowest levels of activity associated with the total cost for each period. What Is the High-Low Method? In cost accounting, […]

Sundry creditors is a term used to describe individuals or businesses that provide goods or services on a credit basis. A business that makes use of this facility and takes goods or services from another business on credit, will refer to the provider of these goods or services as sundry creditors. The concept of sundry

Income Statement of a company is one of the richest sources of information concerning its financial health and standing. There are numerous measures in an Income Statement that facilitate one’s understanding of the factors as mentioned earlier. One of these measures is the gross profit of an organisationThe Gross Profit (GP) of a business is the accounting result

Every business incurs costs during its course of operations. These expenses are categorised into fixed costs and variable costs. It is important for businesses to understand how to calculate fixed costs in order to correctly price their goods and services. What are Fixed Costs? Fixed costs are a type of expense or cost that remains

An enrolled agent is someone who is recognized by the U.S. Department of Treasury as a tax advisor and federally-authorized tax practitioner. They typically work for accounting or tax firms, or they can be self-employed. They help individuals and businesses with their tax preparation What Is an Enrolled Agent? An enrolled agent (EA) is a tax

A liquidity ratio is a type of financial ratio used to determine a company’s ability to pay its short-term debt obligations. The metric helps determine if a company can use its current, or liquid, assets to cover its current liabilities Three liquidity ratios are commonly used – the current ratio, quick ratio, and cash ratio. In

A double-entry bookkeeping system is where a corresponding entry is made for every transaction, i.e. debits and credits. The basis of the double-entry bookkeeping system is that every transaction has two parts and affects two ledger accounts. The double-entry system of bookkeeping deals with two or more accounts for every business transaction.  For example, if

A dividend can be described as a reward that publicly-listed companies extend to their shareholders, and its source is the company’s net profit. Such rewards can either be in the form of cash, cash equivalent, shares, etc. and are mostly paid from the remaining share of profit once essential expenses are met. A company’s board of directors

Diversification is a risk management technique that mitigates risk by allocating investments across different financial instruments, industries, and several other categories. The purpose of this technique is to maximize returns by investing in different areas that would yield higher and long term returns. Most experienced investors agree that, although it does not provide any guarantee