The commission payable is taken to the debit side of the Profit and Loss and credited to the concerned officer. If there is no whole-time director or manager, part-time directors put together can receive, apart from the fees for attending meetings, a commission of 3 per cent (maximum) of the net profits. Otherwise, the part-time […]
Category Archives: Bookkeeping
The debt to equity ratio measures the riskiness of a company’s financial structure by comparing its total debt to its total equity. The ratio reveals the relative proportions of debt and equity financing that a business employs. It is closely monitored by lenders and creditors, since it can provide early warning that an organization is […]
Inventory carrying cost depends on inventory turnover rate, number, and variety of SKUs present in the stock and whether you fulfill your orders or hire someone else for it. When you have items in ongoing production, the intermediate works in progress need to be stored. For example, if you manufacture cars, you would individually ready […]
Suppose you borrow $1,000, which you need to repay in five equal parts due at the end of every year (the amortization term is five years with a yearly payment frequency). The lender charges you 12 percent interest, that is calculated on the outstanding balance at the beginning of each year (therefore, the compounding frequency […]