What are Reserves in Accounting? Reserves in accounting encompass allocated portions of a company’s profits or capital earmarked for specific purposes, contributing to financial stability and strategic planning. They contribute to a company’s financial health, serving as a cushion for uncertainties, supporting strategic initiatives, and ensuring compliance with regulatory standards. …

Understanding the income effect is like observing a shopping spree at a mall when a paycheck comes through. Suddenly, everything appears within reach. This phenomenon is what economists term the income effect. It’s a straightforward concept illustrating how fluctuations in income sway purchasing habits. When more money is at the …

Budgets help both individuals and organizations stick to a financial plan. One of the most basic types of budgets is a static budget. What is a Static Budget? A static budget, or a fixed budget, is a predetermined financial plan that remains unchanged throughout a specific budgetary period, irrespective of …

When it comes to business transactions, a Confidential Information Memorandum (CIM) plays a pivotal role. This document serves as a window into a company’s operations, financials, and strategic plans, providing potential investors or buyers with a comprehensive overview. It’s essentially a roadmap that guides interested parties through the intricacies of …

Inventory is any goods that a company produces to generate revenues. For most companies, it is the primary income source. Before selling these items, companies must know what inventory cost is. What is Inventory Cost? Inventory cost encapsulates the comprehensive expenses incurred by a business throughout the inventory management process. …

When it comes to doing business internationally, one of the most important factors to consider is where to establish a trading house. A trading house is basically a company that facilitates trade between different countries by buying and selling goods. Without a doubt, the location of a trading house plays …

Companies prepare an income statement to provide a report of their financial performance. Sometimes, they may focus on a specific area instead of a comprehensive view of its performance. Therefore, they may prepare a partial income statement. What is a Partial Income Statement? A partial income statement is a targeted …

Bankruptcy is not a very uncommon thing. Among the many terms thrown around,  the ‘363 Sale’ is a very common one. This term refers to a sale of assets in a bankruptcy case, specifically under Section 363 of the U.S. Bankruptcy Code. It’s a process that allows businesses to sell …

Estimating the revenues and expenses for a project is not as straightforward as it is a continuous process. Therefore, companies must use various approaches to assess them. One of those approaches is the percentage of completion method. What is the Percentage of Completion Method? The percentage of completion method is …

Understanding carbon credits can be quite a task. Yet, it’s a topic that holds immense relevance in today’s world. At its core, a carbon credit is a permit that allows the holder to emit a certain amount of carbon dioxide or other greenhouse gasses. The idea is to reduce the …