Outstanding Expenses
Outstanding expenses are the expenses for which the expenses are not paid in return for the goods or services availed.
These expenses are the monetary obligation of the business, which a business needs to fulfill in the future.
For Example, Postpaid mobile bills.
Prepaid Expenses
Prepaid expenses are the expenses for which the expenses are paid in advance in return for the goods or services availed.
These expenses can also be considered as current assets as the amount is already paid for the goods or services in advance.
For Example, Paid three months of rent in advance.
Accrued Income
Accrued income is the income that is not received for the goods sold or services performed.
These incomes are the asset of the business as they will increase the cash balance shortly.
For Example, Commission will be paid after three months
Unearned Income
Unearned income is the income that is received in advance without performing any service or sale of the goods.
These incomes are treated as a liability as the business is liable to perform the activity for the consideration received.
Journal
Journal is an entry in the books of accounts for the transactions/events that happened in the business.
The alteration with a new transaction will change the dynamics of the debit or the credit side of the accounts.
For Example, Goods sold in cash will debit the cash account and credit the sales account.
Ledger
The ledger account is the summary of the transactions in the books of accounts. Ledger is a tabular representation of the debit and credit, which is useful for the preparation of final accounts.
Trial Balance
Trial balance is the accumulation of all the entries in the ledger account in debit and credit columns. The trial balance s prepared with the total of all the ledger account separately to have mathematical accuracy in the final statement.
Business Location
Location plays a significant role in a business. Visibility of your business is not only good for the sale of your product, but it is also so helpful in creating a relationship with their customer.
The location of a business depends upon various factors like cost, availability, and accessibility by the customers.
Some factors play a significant role In the decision of the location for your business.
Balance Sheet
The balance sheet is the statement of a firm’s assets, liabilities, and capital. Both sides of the balance sheet are generally equal.
Bank Statement
The bank statement is the summary of the transaction of an account holder every month.
Accrual Basis Accounting
Accrual basis accounting is the accounting where a transaction is recorded at the time of the occurrence of that event irrespective of the cash element.
For Example, Accrued commission will be recorded in the books of accounts even when the cash is not received for that commission.
Cash Basis Accounting
Cash basis accounting is based on cash transactions.
For Example, Paid office rent is considered a transaction and will be recorded.
Acquisition
The acquisition happens when a big company acquires a small company. The small company sometimes loses its identity in the process of acquisition.
The acquisition helps expand the product line. The acquisition seems to be a better choice even when the acquired business is not doing well as it saves a lot more money on departments like research and development than opening a new product line.
Merger
A merger is the collaboration of two or more single entities working separately on their own comes together to form a single entity for future business opportunities.
Companies use these mergers techniques to combat many adverse situations. Companies decide to have a merger as an option when it is the right time to take the collaborative route for the betterment of both parties.
Retained Earnings
Retained earnings are the portion of profits kept by the business before the distribution of the dividend to the shareholders. These profits are retained in the form of reserves for the future.
Demand
The organization’s motive is to create a product that suits their targeted audience. customers tend to demand certain products per their needs.
Customer demand shows no pattern as it changes with certain factors like seasonality, taste and preferences, price of substitute goods, and many more.
The more the price is, is less likely it is that a large audience will buy the product. Companies should consider the price sensitivity e of their targeted audience before pricing their product.
Demand forecasting
Forecasting is a technique used to predict future events and outcomes for today’s actions. It helps the organization to plan accordingly and to make their plans future-proof.
Demand forecasting is yet another way of having an estimate of buyers’ intent in the future about their product.
