How to Read and Analyze Balance Sheet of a Company?

A company’s financial statements allow its stakeholders to understand its operations better. In most cases, these will include the balance sheet, the income statement, the statement of cash flows, and the statement of retained earnings. Along with these financial statements, companies will also include notes to the financial statements. These notes include information about the …

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Accounting for Written Off Bad Debts: Definition, Example, and Journal Entries

Accounts receivable is an account in the balance sheet that represents the amount owed by customers to a company. This account holds all the receivable balances which may come from various customers. For most companies, this account also represents the total credit sales made by a customer with pending payments. Any company that offers a …

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5 Tips to Improve Days Payable Outstanding

The information presented in a company’s financial statements can provide significant insights into its operations. For stakeholders, particularly shareholders and investors, this information can be significantly crucial. Of these financial statements, most stakeholders focus on the balance sheet, income statement, and cash flow statement. Sometimes, however, the information presented in these statements may not be …

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Accounting for Issuance of Treasury Stock: Example, Journal Entries and More

Companies issue shares to their shareholders and gets finance in exchange. This finance becomes a part of a company’s equity. Through this equity, companies can run their operations and fund various operations. Usually, shares do not stay with the same holder and may change hands several times. These shares remain in the financial statements and …

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Accounting for Issuance of Common Stock: Example, Journal Entries, and More

Most companies have limited sources of finance. Usually, these include equity and debt. Of these, the former comes from a company’s shareholders. In exchange for these instruments, the company issues shares, which provide the holder with several rights. These rights include receiving dividends and voting rights. The latter source of finance comes from third parties, …

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