5 1 Describe and Prepare Closing Entries for a Business Principles of Accounting, Volume 1: Financial Accounting
Permanent (real) accounts are accounts that transfer balances to the next period and include balance sheet accounts, such as assets, liabilities, and stockholders’ equity. These accounts will not be set back to zero at the beginning of the next period; they will keep their balances. The remaining balance in Retained Earnings is $4,565 (Figure 5.6). Permanent […]
Consolidated and Non-Consolidated Financial Statement
Changing from consolidated to unconsolidated may also raise concerns with investors or complications with auditors so filing consolidated subsidiary financial statements is usually a long-term financial accounting decision. There are however some situations where a corporate structure change may call for a changing of consolidated financials such as a spinoff or acquisition. An unconsolidated subsidiary […]
What is the difference between product costs and period costs?
Administrative activities are the most pure form of period costs, since they must be incurred on an ongoing basis, irrespective of the sales level of a business. Selling costs can vary somewhat with product sales levels, especially if sales commissions are a large part of this expenditure. When creating your budget each year, you might […]