by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is the Equity Method?The equity method is the accounting method used by Company A to report on its financial statements the earnings of Company B in which the reporting company holds an ownership interest. The amount included is calculated as:Amount Reported =...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is the Accounting Principles Board?The Accounting Principle Board was created by the American Institute of Certified Public Accountants (AICPA) in 1959 as an authoritative body for the purpose of issuing guidelines and rules on accounting principles. The...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is a Long-Term Asset?A long-term asset, often known as Plant Assets, is an investment that a company preserves and does not convert into liquid cash for a period of about one or more years. For example, if a company operates on a cycle that is more than a year,...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is the Accounting Cycle?An accounting cycle is the comprehensive process of identifying, analyzing, sorting, recording and crediting the payments made and received by a company or any other business entity during a specified period of time, referred to as the...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is an Accounting Profit?Accounting Profit is a company’s gross revenue minus its explicit costs. It is the net earnings on its income statement calculated according to generally accepted accounting principles (GAAP). The explicit costs of a company include...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is Overhead?In business and economics, overhead or burden costs refers to the day-to-day expenses of running a business. Unlike raw materials and labor, which directly affect the product costs, overhead expenses do not directly affect the prices of a particular...
