The Debtor Days Ratio shows how quickly a company turn the credit sales made into cash. It’s therefore reasonable that the smaller the debtor days ratio, the quicker a company is able to collect...
Category: Tutorials
Liabilities are financial arrangements (normally called debt or loans) that create an obligation on a business to expend economic benefits to a third party. The accounting for liabilities is through...
Following our articles looking at business analysis, we turn to the net profit ratio (NPR). In business, we also often refer to this ratio as the Net Profit Marin. Rather than looking at return on...
The ability for owners to draw on capital built up in a business is important for capital growth. We provide a full example with journal entries and explanations.
Revenue is the inflow of economic benefits as a result of past events. Accounting for revenue is critical in financial reporting. Our article works through the journal entries and accounting equation...
Definition Expenses, or operating expenditure, are payments or outflows of economic benefits from a business to pay for the day-to-day running costs incurred as a result of transactions that have...