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For example, $225K would be understood to mean $225,000, and $3.6K would be understood to mean $3,600. Multiple K's are not commonly used to represent larger numbers. In other words, it would look odd to use $1.2KK to represent $1,200,000. Ke – Is used as an abbreviation for Cost of Equity (COE).
In accounting, the revenue recognition principle states that revenues are earned and recognized when they are realized or realizable, no matter when cash is received. It is a cornerstone of accrual accounting together with the matching principle. Together, they determine the accounting period in which revenues and expenses are recognized. [1]
Gross sales are the sum of all sales during a time period. Net sales are gross sales minus sales returns, sales allowances, and sales discounts. Gross sales do not normally appear on an income statement. The sales figures reported on an income statement are net sales. [4] sales returns are refunds to customers for returned merchandise / credit ...
The gain is unrealized until the asset is sold for cash, at which point it becomes a realized gain. This is an important distinction for tax purposes, as only realized gains are subject to tax. Gains are the result of circumstances, events, or transactions which affect the entity independent of revenue or owner investments.
For example, if a sales representative earns a commission at the time of sale (or delivery) but is compensated in the following week, in the next accounting period, the company recognizes the commission as an expense in its current income statement to match the sale proceeds (revenue).
Examples of common financial accounts are sales, accounts [1] receivable, mortgages, loans, PP&E, common stock, sales, services, wages and payroll. A chart of accounts provides a listing of all financial accounts used by particular business, organization, or government agency.
Each account in the chart of accounts is typically assigned a name. Accounts may also be assigned a unique account number by which the account can be identified. Account numbers may be structured to suit the needs of an organization, such as digit/s representing a division of the company, a department, the type of account, etc.
Financial statements display the income and expenditure for the company and a summary of the assets, liabilities, and shareholders' or owners' equity of the company on the date to which the accounts were prepared. Asset, expense, and dividend accounts have normal debit balances (i.e., debiting these types of accounts increases them).