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Tag - balance sheet

THE WEBSITE IS ABOUT MANAGERIAL ACCOUNTING. EXPLAINED IN PLAIN LANGUAGE. ABOUT ACCOUNTING WITH LOVE

How to develop an account policy

It is the most contradictory document in management accounting system. It is said to be an integral part of enterprise documentation, but in most cases hardly can we find it (remember, we are talking about the account policy in management accounting system), and if we succeed in finding it, it is rarely used at the enterprise. Let’s try another way. So, «Account policy» is a set of rules concerning accounting or management accounting, aimed at reaching the top level of transparency in...

Financial performance

First of all you need to consider whether you need them or not. To make it cleat financial performance is a ratio of one line from Balance sheet to another one or to the line from Profit and loss account. For those who blindly believe that the figures of financial performance will throw light on the real state of affairs, I will claim once again: Financial performance is not the magical figures enabling to realize, it is the result of the...

Net profit margin in sales volume

Shows the net profit margin (in percentage, %) in the sales volume of the enterprise. It is calculated by formula: Where can we get the figures? Net profit can be found in the TOTAL line of Profit and loss account Sales volume can be found in the line 1, Profit and loss account This figure is to be posted into Profit and loss account under the line “Net profit”.

How to verify the managerial statement for the accounting period

Well, your accountant is presenting balance sheet, profit and loss account as well as cash flow statement prepared for the previous month. Even if you trust your employee and find him/her reliable, you should be able to make the express check anyway. First of all, it is necessary to:         1.       Compare the closing balance figures in at the end of the accounting period with the opening balance figures at the beginning of the accounting period.         These figures are to be absolutely identical to each other, up to...