by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is Residual Equity Theory?The residual equity theory says that common shares make up the only true equity of a company. Preferred shares should be treated like a liability. Thus, the value of stockholder equity equals only the common shares. Residual Equity =...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is the Appraisal Method Of Depreciation?The appraisal method of depreciation is a method of asset depreciation whereby one assesses and reports the difference in the value of the asset at the beginning and at the end of the accounting period. The difference is...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is a Business Interest Expense?Business interest expense refers to the interest cost imposed on business loans for maintaining operations. The business interest expenses may be deducted as an ordinary business expense for particular businesses. To be able to...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is Black Box Accounting?Black box accounting refers to the use of complex accounting methods by a company in order to confuse a casual reader or make the interpretation of financial statements extremely difficult. When using black box accounting, companies...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is a Relevant Cost?A relevant cost is a cost affected by a manager’s decision or managerial decision making. What is an Irrelevant Cost?An irrelevant cost is a category of cost that is not affected by managerial decisions. This means this cost does not...
by TheBusinessProfessor | Feb 23, 2025 | Managerial & Financial Accounting & Reporting
What is the Percentage of Completion Method?The percentage of completion method is used in accounting to demonstrate how the revenue and expenses of a long-term project are realized based on the percentage of work that has been completed during the period. The...
