Relevance and Significance of Accounting Standard

We can compare relevance and significance of accounting standard with significance of glycerine in beauty products. Is it possible to make beauty products without glycerine? No, absolutely no. Same will apply in accounting. Without accounting standard, we can not make our financial statement correctly. Moreover, accounting standard can revise according to need of business, so, accounting standard are more relevant.

Generally, accounting standard guides us to treat different accounting issues more scientifically. There are lots of accounting standards are made in India and other countries for valuation of inventory, treatment of depreciation, accounting of lease business and investment accounting.

I read a very good thing of significance of accounting standard that it is just like rules of games. Without rules of games, you can not play well because someone can cheat you more easily. Same in accounting, without solid accounting standards, accounting may be the tool of big fraud in business. If you are auditor and you know all accounting standard well, you can uncover the mask of any accounting scandal in company.

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Increase / Decrease in Stock in Trade in Financial Results of Co.

Dear Sir , When I saw our company's financial result  , ( increase ) decrease in stock in trade WIP . In that line in the brackets amounts are there. I want to ask you what does it mean and decrease  in stock in trade also. 2. And Why it is in brackets. After studying all the statement of Accounts I could not understand this . Please clarify

Answer :
I think this stock showing the consumption part of finished goods or some time company may purchase goods for sale. Increase or decrease in stock in trade will show in expenditure side.

1st reason :

Suppose company bought new goods for sale, so its cost will be the expenditure of company. It means increase in stock in trade will be expenditure.

Purchase or increase in stock in trade = closing stock in trade - Opening stock in trade

2nd reason :

If stock in trade is decreased. It means, company did not produce but consumed of previous finished stock. At  that time we also record the cost of that decrease stock in trade  in expenditure side because its sale price will be shown in revenue side.

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Treatment of Preliminary Expenses

When we start a company level business, its promoters pay some expenses like legal fees, company registration fees and MOA and AOA making fees  and others which are helpful to incorporate the company. So, preliminary expenses are those primary expenses which are paid before the incorporation of company. So, when company comes into existence after incorporation, it is the duty of company to repay all these expenses to its promoters. So, after paying all these expenses, we treat all these preliminary expenses with following ways : -

1. When company repays preliminary expenses

Preliminary expenses account Dr.

Cash or Bank account Cr.

2. Treatment in financial statements of company

Only written off part preliminary expenses will show in expenses side of profit and loss account and balance sheet  will show as balance part in asset side because it is a capital item, so we will not whole preliminary expenses in profit and loss account.

3. We divide it with five years or others years as per your company rules and one part of these expenses are written off by transferring it to profit and loss account.

4. Expenses on share issue will not be included in preliminary expenses.

5. It is the duty of company auditor to check preliminary expenses whether these are paid by promoters and have bill or receipt for this.

6. Treatment of Preliminary expenses as per company law

1. Schedule VI  - Payment of preliminary expenses may be in the form of issue of shares.

2. Section 227 (I) of company law - Written off of preliminary expenses.

3. Section 226 (3) of company law - Auditor can not take shares for his services to the company before incorporation.

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What is Journal Entry for Purchase of Assets for Non Trading Concern?

Q :- If I purchase an Asset (furniture, UPS, UPS Batteries, etc.) for non trading concern, shall I pass the Journal Entry, or shall I make entry in Purchase A/c ? If I purchase for Cash, or on Credit. Please answer my question.

Answer :

Before telling you what will the journal entry of this transaction, I want to make you understand that there will not effect on the journal entries whether you are doing business or doing any social activities. Because assets are purchased for non trading concern. It means these fixed assets are for charitable organisation who is not earning profit from this organisation. But  because the assets you have mentioned, are not stock. So, will debit the specific asset and following journal entry will pass.

Particular Asset Account Dr. XXXX

Cash or Name or Party Account ( In case purchase on credit ) Cr. XXXX

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Earn Star points and Rewards for Asking and Answering of Accounting Questions

Prof. Vinod Kumar's  New Announcement

Today, I announce  that you can earn star points and rewards  for asking and answering of Accounting questions.

1. If you will ask 1-25 accounting questions or answers, you will receive gray star * point.

2. When, your total accounting questions and answers are 500, you will receive blue star * and also, I will show your profile in Accounting Education site.

3. If your accounting questions and answers numbers will  reach 5000, you will become our Read Star  *  and I will send you simple -rewards  from my professional income source.

4. When your accounting questions and answers numbers will reach 25000 or more, you will become our super star * and I will send you super -rewards  for this point.

Important Notes

1. #  But be sure, your accounting questions and answers should be logical and important for our readers.  

   2. #  Please Write same name and your email id in each question and answer. So, we can make statistics of your collected stars and communicate to you in future. 

  3. # To Ask accounting question  is also helpful to learn accounting with better way. I am also ready to answer your all accounting questions.  

  4. # Answering questions is the primary way that contributors help each other on Accounting Education. It's the sharing of knowledge and it's easy to do. Before Publishing it, we will read it.

How Can I ask Accounting Question?

You can ask accounting question at here.

How Can I Find Accounting Questions?

You can find all accounting questions which have been asked  by our accounting education community at here.

How can I Answer an Accounting Question?

You can answer of any question by just read the questions at here and you know the answers, then click on answer it blue button and you write your answer inside the form.

In end,  my best wishes are with you for growing in Accounting !

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List of Mutual Funds in Bangladesh

Investment in share capital is becoming more risky business due to affecting of lots of factors but mutual fund is less risky than stock. So, all the big corporations and financial instituitions allow public to invest the money in their mutual funds. If we talk about the main mutual funds in Bangladesh, first of all, we have to understand its economy. Latest news relating to economy of Bangladesh is that it has stopped to depend on foreign loan and it is developing the its own financial organisations who collect fund from own peoples of Bangladesh  and this fund is utilized for developing of Bangladesh. If you are the citizen of Bangladesh, you should invest your countries' own mutual funds and this fund will be helpful for developing your country instead of going loan. I think, if a country demands loan from other country, it means that country is becoming beggar for getting loan. So, for pride of country, we should never demand loan from any other country. Indian may also invest in these mutual fund because Bangladesh was the part of India and still we behave it as our brother. We are interested to make Strong of our brother's economy.

Now, I am writing List of Mutual Funds in Bangladesh. Following is the list of  Bangladesh's largest mutual fund providers. They offer  to public to invest in  these mutual funds. In these providers include the companies of banking sector, insurance sector and finance sectors. There are 4 Top companies who are the providers of mutual funds.

Ist EBL First Mutual Fund

EBL First Mutual Fund is a closed-end fund incorporated in Bangladesh. The fund's objective is to provide high dividend income. The Fund invests in capital market and money market securities. The Fund is listed on the Dhaka Stock Exchange.

2nd  Eighth ICB Mutual Fund

This mutual fund has been made by investment corporation of Bangladesh. It  is a closed-end fund incorporated in Bangladesh. The Fund's objective is to provide dividend income. The Fund invests in the Bangladeshi capital market.

3rd  ICB AMCL Islamic Mutual Fund

ICB AMCL Islamic Mutual Fund is a closed-end fund incorporated in Bangladesh. The fund's objective is to provide high dividend income. The Fund invests in Shariah compliant securities/instruments. The Fund is listed on the Dhaka Stock Exchange.

4rd  Seventh ICB Mutual Fund

Like other ICB financial product, it is also investment corporation's financial product.

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Single Entry Accounting

Single entry accounting is a part of CS accounting syllabus. It means to record one side of entry. Suppose, we sells our furniture, we have not to record furniture sale but we just record total cash received from furniture. So, in single entry accounting, we records cash, account receivables, account payable. No need of recording of other assets, expenses and revenues in this single entry of accounts. So, it is imperfect system of accounting. Double entry system of accounting is 10 times better than this single entry account system. Very small business firms who want to save money from appointing an professional accountant, are using single entry accounting system. For calculating net profit for a particular period in this method, they compare  the financial position of the business at the commencement of the period with the financial position at the end of the period.

All those who are using this system of accounting will be unable to detect the frauds. We can n't make trial balance in it. So, we will not able to calculate mathematical accuracy in this system of accounting. We can not also track the items which are not recorded in single side because there is not provision for passing adjusting entries. I explain it with following example.

Suppose 10% our debtors have decided not to pay in the end of this year. It is our loss in the form of bad debt but single entry accounting do not allow this event to record because neither it is cash item nor it is debtor or creditor.

Now, all businessmen who want to change single entry accounting into double entry accounting can change it by taking the help of professional accountant who verifies its all assets by checking physical existence and record them at their market value and start to pass new transaction according to double entry system.

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Himachal Pradesh University

Himachal Pradesh University (HPU)
Chancellor	Urmila Singh
Vice-Chancellor	Prof. Sunil Gupta
Location	Shimla, Himachal Pradesh, India
Campus	Urban
Affiliations	UGC
Website	www.hpuniv.nic.in

I studied two years in Himachal Pradesh University, Shimla for my post graduation in commerce. It is very great university. Like commerce education, there are other lots of educations which is provided in this university. Himachal Pradesh University has 27 Teaching Departments offering various courses. It is Located in the Summer Hills, Shimla, the campus occupies an area of 200 acres (0.81 km2). The Himachal Pradesh University, a premier institution of teaching and research in the country, was established on 22 July 1970 by an Act of the Himachal Pradesh Legislative Assembly. It is wholly financed by the Government of Himachal Pradesh and the University Grants Commission, New Delhi. It enjoys the status of an ‘A’ class University according to the UGC grading system. The University is situated nearly 5 km away from the town, at Summer Hill, a quiet suburb of Shimla in the vicinity of the Indian Institute of Advanced Study.

I am remembering my study days when I went to this university first time. It is situated in very cool area. Even in june month, you can feel fresh air in this university. There is big library in it for providing good study environment.The University Library is housed in its won multistoreyed building specially designed to house various functions of a modern University Library. The Library building has adequate space to accommodate more than 2 lacs of volumes in stace-hall, about 450 readers in reading halls and about 100 Research Scholars in Cubicles on Different floors. The basement on its completion will also provide space for a Museum, and Exhibition Room, bindery, Repographic Unit and Private Reading Room. Its beautiful surroundings present a panoramic view of snow peaked mountains and are ideally suited to pursue higher learning amidst rhododendron, silver oak, pine and deodar forests. Summer Hill Railway Station is five minutes walk from the Teaching Departments and the main office of the University.

The institute admits 90 students for MBA course. Out of these 90 seats 60 seats are under subsidized category and 30 seats are under Self-financing/NRI/NRI Sponsored. Prof. Suresh Kumar is the Director Institute of Management Studies of HPU.

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The Debt To Equity Ratio ( Simplified )

If any body say to me, " How can we simplify the debt to equity ratio?", I will answer that debt equity ratio is just a simple technique which a bank will check when it will approve or reject any bank loan.

Suppose company want to get $ 10,00,000 loan from XYZ bank. Bank is so smart. Bank manager will check previous year balance sheet and then finds the value of his already taken debt and equity share capital value and then calculates this ratio by debt divided by equity capital.

Suppose that company's debt equity ratio is 5 : 1, it means company has only 1$ equity capital for paying every $ 5. (*Always remember equity share capital is just like a person's own capital. Because equity shareholders are the real owner of company.) It is most risky position, bank will reject this loan to that company after calculating and seeing the overall financial position with this small ratio. So, it is Brahma Astra in the hand of bank manager.

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Funny Pictures on Financial Distress in Flickr

Recently, I am searching some pictures for financial distress topics in flickr but I found some funny pictures which I am showing here. Feel relax from the stress of financial distress.

1.  Are they in  financial Distress?




2. Is he in Financial Distress?



3. How can a person feel  in financial Distress?

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Financial Distress ( Wikipedia )

These days, I am busy to cover some CS Accounting Notes topics. Actually, I have written many topics relating to this in the site. But still there are many topics are pending to explain. I think, without study the basics of anything, we can not write any topic well. So, today, I studied my self financial distress which is the one of important topic of CS Accounting. Here, I am sharing what I learned financial distress in wikipedia.

According to wikipedia

Financial distress is a situation in which company can not live more because company did n't take good decisions and fund goes to nil due to heavy loss which has been given by creditors. So, financial distress means loss of trust of creditors. At that time, company must be liquidate. Suppose, if a company who has $ 100 as long term debt but due to big loss, if its all assets are just $ 20. It means it has no capacity to pay the loan. This situation is financial distress. There are lots of reasons of financial distress. It may be possible that company made large number of finished product but it could not sell all these product or company took loan at high rate of interest and earned profit is less paid interest. So, company must suffer the cost of financial distress.

Wikipedia shows general expenses as cost of financial distress

1. Auditor's fees
2.  Legal fees
3 management fees

In next para, I am thinking, wikipedia is saying deep words regarding the interest of creditors and interest of shareholders.

* Important point in Financial Distress

Suppose total liability is $ 100 in which shareholder's equity is $ 60  and debt equity is $ 40. But market value of company is just $ 20 in market. But, if management sees, if we invest company's all asset in risky project, company's value may increase up to $ 40 dollars. But after taking this risk, if probability of loss of $ 10 out of $ 20, then it will be also big financial distress because risky projects are not in the interest of creditors.

New way to increase the value of Company  and Relieving in case of Financial Distress

1. Adjustment in financial statement.
2. Debt Restructuring is the technique in which company talks with creditors for reducing and renegotiate for solving this financial distress.
3.  Re-organization of their group structure by evaluating and analyzing their core and non-core assets.

If you want to know more new thing relating to financial distress topics, please read our resources :

Financial Crisis
Financial Disaster
Financial Risk

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Financial Forecasting

A financial forecasting  is  an estimate of sales, purchase, earning and value of shares in the market. For doing financial analysis, we used two tools, one is analysis of past financial statement and other is to analyze the market trend.  See Financial statements analysis first.

According to Wikipedia

Arguably, the most difficult aspect of preparing a financial forecast is predicting revenue. Future costs can be estimated by using historical accounting data; variable costs are also a function of sales.

Unlike a financial plan or a budget a financial forecast doesn't have to be used as a planning document. Outside analysts can use a financial forecast to estimate a company's success in the coming year.

Accuracy in financial forecasts  depends on correctness of past financial data and numbers of errors in statistical analysis of market trend. 

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How to Behave Students in Society

Society  is that place where students get all support for education and good knowledge. Parents pay the school fees and provide good ethics. Teachers teach students in classroom. Relatives and other persons of society are also helpful for developing the personality of students. Without this support, students can not achieve their humble ambitions in life.

So it is very necessary that students should behave good with parents,  students and teachers and other parts of society  for creating good environment in society.

My following 5 tips should be followed for showing your behaviour in society.

1st Tip : Respect should be given to all those who meet you in your society. It will create positive approach.
2nd Tip : Help to your parents and neighbours. It shows that your behaviour with them is good because you are obeying by helping them in their work.
3rd Tip : Never tell a lie with parent, relative and teacher. It will reduce your value in society.
4th Tip : Never involve in the bad company of society.

5th Tip : Do part time voluntary social work also, with this, you will learn many good skill of behaviour in society.  Suppose, you are graduate student, you can teach free to poor and orphan students in society. 

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Journal Entries of Project Contracts

For a project total contract is let us say AED ( Arab Emirates dirham) 100000

Accounting Question :
Our company invoiced 90,000 in 2010, but 10% will be invoiced after completion of project in 2011. What is the journal entry if the 10% is invoiced only in next year.

In the profit and loss account, is it be shown as a sperate income ( Sales income - retention )

Materials already consumed in year 2010.

Retention Account Dr.

Sales - Retention Account Cr.

Is it ok for 2010 entry? In 2011, when  it is invoiced

Which Account Dr.

Retention Account Cr.

Answer :

Under FASB's accounting principle, there are many method to deal such issues. But, best is accrual principle. In this principle, when you do sale or started the project after the order by your customer, you will ready to pass the journal entry, whether customer has paid or not. But, I think, you are using other method, in which, you have to send the bill or invoice and then record it as earning or sale.

According to this,

In 2011, we will pass the journal entry

Customer Account  Dr. ( 10% of project ) because, you are sending invoice.

Sale Account Cr.

But if you passed

Retention Account Dr.

Sales - Retention Account Cr.  in 2010, then

In 2011, you will pass

Customer Account Dr.

Retention Account Cr.

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Journal Entry for Fixed Deposit

Question

What will be the entry for fixed deposit with bank by co. for 2 yrs and if loan has been taken on it and what will be the entry of interest given by the bank on F.D

Answer

There will be three journal entries of above transaction :

1. Journal Entry for Fixed Deposit for 2 years

Fixed deposit is that investment which has been done by you for getting interest earning. Bank gets your FD money and send it for giving loan to others and earn margin between interest received on this money and interest which is given to you by bank. So, this is your asset. Real account rule will apply on this asset. We also see that bank is personal account which is affected from this transaction.

Debit : Who is receiver of this money ( In personal account ) = Bank = Bank receives money in the form of FD

It means Fixed Deposit in Bank Account Dr.

Credit : What goes from your business ( In real account or asset account ) = Cash for investing money in secured area.

It means Cash Account Debit Cr.

FD in Bank Account Dr. XXXX

Cash Account Cr. XXXX


2. Journal Entry for loan which has been taken on your own Fixed Deposit

Loan is loan. It is your liability. But, it is secured loan. If you will not pay, your FD will not repaid to you until, you pay your loan to bank with its interest. Now, think which two account affects from it.

One is real account because you receive cash.

Other is personal account because bank gives you money in the form of loan.

So, remember the rules of double entry form.

Cash Account Dr. XXXX
Loan from Bank Account Cr. XXXX

3. Journal Entry of interest which is given by the bank on F.D.

This interest is source of your earning. So, it is gain of your business. I think it is in cash form

Debit = So, what comes in your business = Cash
Credit = which income increase in your business = Interest on FD in Bank

Now pass the journal entry

Cash account Dr. XXXX
Interest on FD in Bank Cr. XXXX

Related : What is public Deposit?

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Tips of Getting Our Answer for Your Accounting and Finance Question

Recently, we changed contact us link with ask a question link. Now, you can ask any accounting and finance related question from us. We daily check your asking question. For seeing its answers, following tips will be useful.

1st tip #  Write full detail of your question because without understanding your question, how can we give you its correct answer. If you are asking journal entry of FD, please explain more like this, " what will be the entry for fixed deposit with bank by co. for 2 yrs and if loan taken on it and what will be the entry of interest given by the bank on F.D" From this detail, we can understand, what is your exact problem of accounting.

2nd tip #  Check update. When we publish your answer in our site, we keep it in above solution link. So, please again visit the site http://www.svtuition.org/ and find your answer in solution. You can also use our search engine for finding your accounting question's answer. We may answer your accounting question one minute after your asking accounting question from us.

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Debt Equity Ratio

Debt equity ratio shows the relationship between company's debt resources and capital resources. It is calculated for getting idea of solvency of company. If company's overall equity is more than overall debt, it means the position of solvency of company is good because company has internal equity to pay outside equity and external debt need not to worry. I have made an introduction video tutorial for more clearing the concept of debt equity ratio.



Captions or Transcript are given below:

Welcome dear student, we will introduce debt equity ratio. What is this? Actually, this is relationship between debt and equity. Means, total debt is divided by total equity. With this, we see the solvency of company. Suppose total debt is 4 and total equity is 8. It means 1 : 2, we have capital 2 times of our total taken debt. We will include total debt. One is long term debt or debenture. Second is current liabilities which we can calculate from our balance sheet. Second element which we need for calculating debt equity ratio is total equity. It is net worth of business, means in this, we will add equity share capital plus pref. share capital plus reserves. If profit and loss account's balance will show in asset side, it will be loss and it will be deducted. We can a simple example. Suppose we have debenture of Rs. 100,000. Our current liabilities of Rs. 100000 and if we divide it with equity share capital of Rs. 200000 , pref. share capital of Rs. 100,000 and reserves of Rs. 100000

Debt Equity Ratio = 100,000 + 1,00,000 / 200000 +100000 +100000 = 200000/400000 = 2 : 4 = 1 : 2

Related : How to Calculate Accounting Ratios

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Investment in Share Market without Knowledge

 I am B.Tech student ; I invested  the 25000/-Rs. in share market. I have no knowledge in this field. Pls tell me the basic procedure and how to invest?

Answer

First thing is your field is technology and you invested in share market. This is most wrong decision, you have taken because share market comes under finance field. Without knowledge of finance, financial position of company, past performance of company, it may be most risky for you. I always say that without knowledge of share market, it is just gambling. If your share price will down, your Rs. 25000 may be Rs. 25  just in one second.  If you track financial news on daily newspaper, you find that there are lots of scams in this field like latest LIC housing loan scam. So, don't invest in future without acquiring sufficient knowledge. My other suggestion to you.

1st # Never invest in foreign company's shares.

2nd # Try to deposit fund in Indian government banks like SBI as FD.

3rd # Read my written content equity risk.

4th # It is my own thinking that investment in education is better than investment in share market. With investment in share market, we learn gambling but investment in education, we become wise. Decision is in your hand. I never invested my hard earning money in this gambling market even, I have sufficient knowledge of this field of finance.  So, save money for doing M.Tech and Ph.D. in technology.

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Job Costing problem of the Accountant of Roll off Company

I work for a demo/roll off company. The books were a mess before I came in. I am trying to figure out a way to assign over head costs to all jobs. The company is commercial roll off/demo company. The jobs normally only last a week. I have been trying allocate the over head by a per minute basis, because of the different types of work that we do. For example we do a switch out which takes a 120 minutes, equipment move takes 180 minutes, a final pull takes 96 minutes, and there are couple of other activities the company does. I basically took all the tickets for one month then multiplied them by how many minutes each activity would take to come up with a total minutes. I then took the P/L and divided each account by 12 to get the cost for one month. I divided that number the total number of minutes to come up with a per minute cost of over head. I only used the accounts that would be considered overhead accounts. The per minute number I am coming up with is too high. What would be a better way to figure this out since they were not job costing.

Solution :

Basically job costing is used in that industry who all work is done on job basis. Suppose, we got the order of making 10 chairs and at that time, we can calculate total job cost and each unit cost in that job by dividing the number of units in that job. In your case, I think, you got specific jobs order for this. So, need not any other method for calculating overhead cost per minute number. You did all right. I can more suggestion by knowing exact per minute number.

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Why is Accounting Difficult

"Why is Accounting Difficult?" has been asked by a student from Johannesburg, Gauteng, South Africa.

Accounting is just like Swimming, learn it as fun 

It is good question and I want to answer of this question. Did you swim in river or not? If you do not know the basics and practical of swimming science, you really feel that to swim in river is most difficult in the world. But when we see animals who have no knowledge like human being, they can easily swim in river without any difficulty. With this simple example, I want to tell you that only human being is the creature in this world who needs to learn every new thing. So, after learning accounting your all difficulty will become nil.

Following may be main reason of students who think that accounting is most difficult subject of the world.

1st Confusion

I do the question of Accounting, but my answer comes wrong.

It may be maths mistake, learn mathematics first. It may be due to not knowing basics of accounting. Pay attention on basics of accounting

2nd Confusion

My Balance sheet does not  match when I try to make it.

Balance sheet is out come of lots of things of accounting. For this, you should know adjustments in final account. If you will do mistake in it your balance sheet will never match. Try to understand that adjustments are those transactions which have not been entered at the end of financial year. So, we have to record properly like any other transaction. I think this part of accounting, you should be take as challenge.

3rd Confusion

I think, Accounting is under only for intelligence guys.

Yes, Your thinking is absolutely right. But, my thinking is that every human being has been made by God and God never make dull human being. So, we all are the son and daughter of God who is big accountant who records our each and every act. Even, when nobody see us and we do any bad work, God records also our that work at that time and declares result after our death. So, how can God do mistake? Leave your narrow thinking. Be positive.

4th Confusion

So hard??? The teacher doesn't explain well and let me tell u this nothing like u can go home and study yourself.

Dear, this is not so hard in your side but it is the mistake of your teacher who is unable to teach you well. But you need not be Be despondent. As teacher, I advice you, never feel accounting as difficult subject but give time to understand asset, capital, equity, liability, current asset, current liabilities, debtor, creditor, expenses and incomes. Try to search with these word's definition. Accounting is just effective use of these basic items for the purpose of tracking business's current financial position and performance.

5th Confusion

How to analyze the Cost accounting and Management Accounting

You need not feel difficulty if you have covered financial accounting. For analysing cost accounting and management accounting, all accounting information are received from FA. But you should learn the tools and techniques to analyze. It may be ratio analysis, fund flow analysis, cash flow analysis, debtor management, break even point analysis and many other tool.

In end, I will say only,

 "A good start is half done." - Start to move hand and legs, you will learn swimming.

"Only for Once and for Ever." - Start taste of accounting once, you will make habit of this.

Related : What is Easy and What is Difficult

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Journal Entries Tips

There are many different ways that you can write journal entries. You can manual books or computer for this. Correct journal entries are great way to make correct financial statements. But when you don’t have deep knowledge of passing journal entries of every type transaction, you would see that the amount of accounting mistakes  would increase. So, today after getting great demand from fresh accountants' side, I am writing journal entries tips which will be helpful for you to pass the journal entries of all type of transactions.

1st Tip : Learn Basics of Journal Entries

It is my own opinion that without learning of basics of journal entries, you can not pass a very simple transaction. In basics, you must learn three types of accounts, one is personal account, second is real account and third is nominal account
All types of account will goes to in these main three accounts. Now, you have to understand that every transaction has two part and two sides will affected with this transaction. One account will be debit and other will be credit. For example, you have provided provision of  bad debt as 10% on your total debtor of Rs. 10000. Now, you duty is to pass this transaction. How will you do this. It is so simple.

First we are seeing, there is no receiver or giver in this transaction, there is also, nothing is coming or going from business and third we are also seeing, there is nothing expense or income in this case. It is just reservation for future.

You it surely affect one side of provision of bad debt account means we have to show closing balance of provision for bad debt account as Rs. 1000 and on this basis, we can calculate the journal entry of transferring net loss of business due to bad debt and new provision. After this we pass the journal entry

Profit and loss account Dr. XXXX
Provision for bad debt account Cr. XXXX

2st Tip :  To read more and more journal entries examples.

Reading  more and more journal entries will make you perfect in accounting and journal entries. Like reading anything, reading of journal entries should be part of your daily learning. Today, I read the word eloquence, it means fluent, forcible, elegant or persuasive speaking. If I will not read more and more words, how can I perfect in it? Same thing will apply on journal entries also. So, read my some of journal entries example at here.

3rd Tip : Learn Difficult Journal Entries

It is easy to pass simple business transaction, but it is difficult to pass the journal entries of some of difficult business transactions. If you don't know how to pass difficult journal entries, read Prof. Augustins's tips at here.

4th Tip : Try to Know "Why Journal Entries are Important in Accounting?

This is a very popular statement in accounting industry. Every one is talking about journal entry, but what exactly journal entry is and why journal entry is king. Truly speaking for me journal entry  is nothing but every thing. Did you succeed to pass  it….!

Yes, Journal  is everything in accounting.  Journal entry is very important in accounting, because in accounting  the only way to start to record raw financial data. Only after crossing this step, raw data converts in useful accounting information.

5th Tip : Get a Lesson from Rectification of Error

When a professional CA finds error and rectifies it, you must get a lesson from this. It will prove your skill of passing journal entries.

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PNB Online Fund Transfer

Today, I  learned to PNB online fund transfer. PNB online fund transfer is so easy and fast. So, I am ready to start it for all my bank transfer through online PNB Account. Here, I am writing my first time experience in this case.




1. Login To Online PNB Account

First of all, I had to login my online PNB account by using the user id and password which was given by my branch to me.

2. Change Txn Password

It is the first time, my online pnb account asked me to change txn password. After changing it, I could reach to my home page of online pnb account.

3. Click on Transfer Link in My PNB Online Account

When, I clicked on transfer button in my pnb online account, transfer payment button showed me in left side also and I also clicked transfer payment

4. Click on  Payee Setup (within PNB transfers)

 5. Click on Register a Payee for Transfers within PNB

6.  Add Payee by writing name of payee and payee account no. and then click on add payee button

7.  Click Back on Bill payment and then click make a new payment

8. Click Payment to a Payee within PNB

9. Write the amount of payment and payment remark and then click pay button

Note : Problem Facing Regarding Payment payment via online pnb

dear customer, credit would be effected solely on the basis of beneficiary account number entered by the customer

After asking the problem with customer care, he said to me, " Wait 24 hours for payment after Register a Payee for Transfers within PNB.

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How to Get Online MBA Degree in India

Online MBA Degree in india is Just Far a Click

MBA  is a professional degree in India for getting any managerial work in India and in abroad. It includes all subjects the fundamental subjects of accounting, business environment, management and economics. But in last semester, MBA student has to choose any one specialized subject, it may be finance or marketing or HR. MBA makes a student leader of management. If you would like to have MBA Degree, in Distance Edu. or online way, you can learn management techniques in MBA  while you are working and after getting MBA Degree your promotion chances will increase.

So, today content is for all above students who are B.A. or B.Com. or B.Sc. or any other graduate degree and they are interested to do online MBA in India instead of doing regular MBA.

Online MBA Degree in India

Steps to Getting it :

If you check the List of UGC Recognised Universities in UGC site deeply, you can find lots of recognised universities who have started online MBA degree programme specially for Indian students. After revolution of Internet, you can enroll yourself for MBA education online on the site of respective recognised university. You can collect all study material at your home either download in PDF file or see on University site and print it if need for your future reference. You can also learn on YouTube related to the subjects of your MBA. Like me, there are so many other professional teacher are guiding you practically. So, there is no problem to clear exam. without going to college or university.
How to Contact

Many university has made educational center for your convenience. For instance, ICFAI is university which is situated in Hyderabad, has its own educational center in every city. From where you can get more information also.

Benefits of Online MBA Degree in India

You are seeing today 17th Jan. 2011, FT told that politician will have to pass MBA for entry in politics in US.  So, you have to get online degree in India instead getting outside India. If you get this from Indian university, you can increase your potential of earning and achieve your goals in life.

Related : How to Find Fake Educational Institute in India

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How to Calculate of Accounting Ratio

To calculate of accounting ratio, you need to remember and use of accounting ratio formula. These formulae are made by the persons who have both the knowledge of accounting and mathematics because ratio is the part of mathematics science and if you same ratio for financial statement analysis, then, it will be helpful also for those who are interested in business and its analyzed results. Every person is interested in business for knowing its profitability, liquidity and solvency position. Accounting ratio is easy way to explain complex and big financial statement in % form. We are calculating following Accounting ratios with given information. I think example is better than writing any detail of concept.

You are required to calculate :

i) Dividend yield on equity share
ii) Cover for the preference dividend
iii) Cover for the equity dividend
iv) Earning per share
v) the price earning ratio
vi) Net cash flow

Given information

The capital of star co. ltd. is as follows :

80000 equity share of Rs. 10 each = Rs. 800000
9% 30000 preference shares of Rs. 10 each = 300000

The following information has been obtained from the books of the company:

Profit after tax at 60% = Rs. 270000
depreciation = Rs. 60000
equity dividend paid = 20%
market price of equity share = Rs. 40

Solution

i ) DYES = DPS/ MPPS = 10 X 20% / 0 = 5%

ii ) CPD = Profit after tax / pref. dividend = 270000/ 300000 X 9% = 10 times

iii) CED = Profit after tax and pref. dividend/ equity dividend = 270000 -27000/ 800000 X 20% = 1.52 times

iv) EPS = Profit after tax and pref. dividend/ no. of equity shares = 270000 -27000/ 80000 = Rs. 3.04

v) PER = Market price per share / earning per share = 40/ 3.04 = 13.1 : 1

vi) Net Cash flow = net profit after tax + depreciation - total dividend = 270000 + 60000 - 27000 -160000 = Rs. 143000

( Note : because depreciation is not paid in cash, so it is operating loss but not cash, so it will include in net profit, if we are interested to calculate cash profit of business. )

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Convertibility of Rupee ( A Conspiracy to Lower the Value of Indian Currency)

Convertibility of Rupee Cycle

Meaning of Convertibility of Rupee

Convertibility of rupees is known as freedom of exchange of rupee with other all international currency. It means that rupee can covert in USA dollars more easily and USA dollars can convert in Indian currency for buying and selling of goods and services. after study everything, I am writing,  "it is conspiracy to lower the value of Indian currency that in real sense. In 1996, there were  just Rs. 38 for every one dollar but after liberalized convertibility of rupee, one dollar exchange rate has reached up to Rs. 45 in 17th Jan. 2011. When convertibility of Rupee was started, it was claimed that our export will increase because our Indian companies will easy to trade in foreign country due to easy exchange without any govt. restriction. But, it opens doors for importing useless things and moreover it is very sad for India that gold is not make as standard exchange currency. China is smart than India, under his new foreign exchange policy, convert all his foreign exchange in gold. Now, his Chinese yuan is equal to Indian Rs. 6.89.

* Meaning of Partial Convertibility of Rupee

Partial convertibility of Rupee was started in 1992 for current account. In simple word, there is no control of Indian currency official. Any foreign company can do business and can go to his country with this profit after exchanging all Indian currency in their foreign currency. For example, According to its Directors’ Report, a public document filed with India’s Registrar of Companies, “Google India Private Ltd” reported revenues of Rs. 779.34 crore (around $172.03 million at current rates), over the 15 month period from Jan 2009 to March 2010. For the same period, it reported a profit after tax of 97.96 crore ($21.62 million), and received foreign exchange of Rs. 666.25 crore, with a foreign exchange out go of Rs. 304.24 crore. In this, example, we see that there is no our control our one foreign currency. From economic point of view, if any country has largest amount of other countries currency, that country will become economically sound. Suppose, if India has not USA dollars for exchanging Rs. 304.24 crore to Google India Pvt. Ltd, at that time, India has to take loan of same USA Dollars  from USA and will pay interest on it. So, it will increase adverse balance of payment.

It is true, with partial convertibility of Rupees, investment in foreign country has become easy but it is also harmful for India, because same investment should be in India instead any other country. All companies think the benefit of their residential country from where they are operating their business. So, for India's interest, we have to make some strict rules for stopping outflow of fund on the the name of convertibility of rupee or liberalisation.
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* Meaning of Full Convertibility of Rupee of Capital Account

Suppose, Mr. ABC is company of USA, it can buy any property in India by full conversion his currency in Indian currency.

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Limitations of Financial Statement Analysis

Following of main limitations of financial statement analysis :

1. It is just study of interim reports.

2. It check just monetary aspect of company's performance and position but it ignores non-monetary aspect of company.

3. It does not analyze the changes in price level of different items of financial statements.

4. Many accounting concepts and conventions are used for preparing financial statement and these concepts and conventions are accepted for analysis. So, analysis is totally affected with these accounting concepts.

5. Analysis of financial statements are just source but not decision or result because person who write its interpretation, may also affect the analysis. So, different interpretation by different person may become its limitation.

6. LIFO vs FIFO and different depreciation methods usage may bring difference in result and performance of financial statement, so it is also limitation of financial statement analysis.

7. If one company's accounting period completes at 31st Dec. and other company's accounting period completes at 31st march, we will unable to compare both company's financial statement and it will be the limitation of financial statement analysis.

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How to Analyze Financial Statement

Financial statement analysis can be used for many purpose in business. With this analysis, management can take decision regarding more investment in inventory by buying or making it or other decisions like investment in different fixed assets. If financial statement analysis shows the low amount of fund for operation, at that time, company can take decision of issuing new share capital or managing of new bank loan. by Simple comparison of past items of financial statements with the current items, we can analyze the profitability, solvency, liquidity and stability of company. Comparative income statement, comparative balance sheet and ratio analysis are the main tools of analyzing financial statement.

Steps to analyze financial statement

1st Step : Calculate the Different Ratio of past and current years:

Suppose, you want to check profitability of company. At that time, you will calculate gross profit ratio, operating cost ratio and net profit ratio of both current year and previous year.

Current year gross profit ratio = 185000/800000 X 100 = 23.13%

Previous year gross profit ratio = 105000/700000 X 100 = 15%

Current year operating cost ratio = 36000/800000 X 100 = 4.56%

Previous Year operating cost ratio = 35700/700000 X 100= 5.10%

Current year net profit ratio = 154610/800000 X 100= 19.32

Previous year net profit ratio = 68750/700000 X 100 = 9.82%


2nd Step : Interpretation of Facts

It is the important step of analyzing of financial statement. In this step, we explain facts in simple words, from above ratio, we can explain that gross profitability of company has improved because it increased from 15% and reached at 23.13%.

Company has also succeeded to reduce his operating cost. It decreased because previous year operating cost was 5.10% but this year, it is just 4.56% and its result, we are seeing that net profitability of company has reached up to 19.32% of total sale.

Note : This just one example in which we have checked the profitability position of company and same way we can also check solvency position of company by calculating debt equity ratio or other ratios. Solvency means power of company to pay his all long term debts and other liabilities. Suppose if debt equity ratio is 1: 4, it means company is more solvent because company's shareholder fund is 4 and debt is just , so, debt can easily be paid anytime.

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How Not to Retire

Saving is good way for spending retirement time more smoothly. It also makes you economically sound and you do not become as retired person after retirement in real sense because if you have lots of saved money, you can start a good business even after age of 60. Your wish of not to retire also will fulfill with good saving habit at the time of young age. After searching different sites, I got some of following good tips and same are sharing with you.

One Good tip  from Freemoneyfinance.com

 If you want enough saved to retire you need to invest early and often. This guy didn't do so and now he's looking at working for most of the rest of his life. This isn't necessarily a bad thing -- as long as he can work (many people do better working than not working.) But if his health fails, he's in deep trouble.

One Good tip from Consumerreports.org

If you're fortunate enough to have a traditional defined-benefit pension coming to you, staying in the rat race can make you a richer rodent. That's because pensions are typically figured using a formula that multiplies your years of service by some percentage of your salary. Not only will more years mean a bigger pension, notes Bill Ramsay, a certified financial planner in Raleigh, N.C., but since your salary will probably rise each year you stay on the payroll, that too will boost your total.

One Good tip from forbes.com
If you want to stay on with your current employer, consider asking your boss for reduced hours, less responsibility or cyclical work that would still bring in some money but give you more flexibility, a sort of virtual retirement.

One Good tip from Moneycentral.msn.com

Plan to work at least part time for extra income during retirement.

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Hedge Fund Accounting

If you are professional investor, you surely think to reduce the risk on your investment. Hedge fund may be best option for you. We already explained what is hedge fund, if you did not study, then please first, study it. In this content we will cover hedge fund accounting.

What is Hedge Fund Accounting?

Hedge fund accounting is that system of accounting in which professional accountant records the transactions relating to hedge funds.  In this system, hedge fund is a self-balancing set of accounts, segregated for specific purposes in accordance with laws and regulations or special restrictions and limitations. Either investment manager maintain the hedge fund accounts himself or he can also outsource it to other professional accounting firms.

More Explanation of Hedge Fund Accounting in Simple words


Hedge fund is collected from investor's investment and all investors wants to know their performance and their total investment report and financial position of total hedge fund. So, all these things can be possible with good hedge fund accounting technique. Hedge fund accounting is not so easy like any other business's accounting because in single hedge fund, there may be billions of dollars. For example, professional accountant has to record of $53.5 billion assets under hedge fund of JPMorgan.


What are items Under Hedge Fund Accounting


1. Calculation of total Investment in this Fund by each investor and its record.
2. Total management fees which is taken by its investment manager and its record.
3. To find the fair value your derivatives independently, which is an important aspect of hedge fund management.
4. portfolio accounting
5. cash management in hedge fund
6. accounting reports for their investors
7. tax reports 
8. account for investor capital flows in and out of a fund.
9. Record of  redemption fee if investor withdraw money from the fund.
10. Holdings reconciliation to custodian banks.
11. Calculating monthly Net Asset Valuations for the purpose of reporting to investors.
12. Preparation of annual financial statements.
13. Preparing fund performance reports.
14. Calculation of  weekly return estimates.
15.  Track future investor withdrawals or contributions in advance.

Related : Wikipedia Accounting

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Wikipedia Accounting

Wikipedia Accounting is the famous article of Wikipedia.org. Its accounting content is divided into 3 parts. In beginning of content, it defines, "Accountancy is the process of communicating financial information about a business entity to users such as shareholders and managers." The general areas of accounting are financial accounting, cost accounting, and management accounting. Accounting  includes records and presentation and analysis of financial statements. Now, we are explaining its 3 parts.

Ist Part

Etymology of Accounting

As per wikipedia, accounting and accountant both words had been taken from french and Latin language.

2nd Part

History of Accounting

Recently, I started to add the content "Proof of Beginning of Accounting in Vedas" in wikipedia's accounting article. In which, I mentioned,  "Vedas are the oldest books of the world and after deep study of these sanskrit books, you can find that accounting was started at India's vedic period. Vikraya is found in the Atharvaveda and the Nirukta denoting ‘sale’. Sulka in the Rig veda clearly means ‘price’. In the Dharma Sutras it denotes a ‘tax’
You can add more reference in it. More history is explained by me at here.

3th Part

Accounting scandals

dd In this part Wikipedia explained big corporation accounting scandals. One of most important accounting scandal is Enron scandal . Through the use of accounting loopholes, special purpose entities, and poor financial reporting, were able to hide billions in debt from failed deals and projects. Wikipedia also opens new page for accounting scandals, in which you can study Notable accounting scandals from 1980 to 2010. This page is also important for new and fresh CAs and auditors who are learning "how to unveil accounting scandals in big organisation?"

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How to Share Keyboard and Mouse

Before knowing the way to share  keyboard and mouse, you should know its importance. To share keyboard and mouse with two computer is very important when you want to work on two computer machines with same keyboard and mouse. It can also be used when your second keyboard and mouse has dead. Before buying second keyboard and mouse, you can use one computer's keyboard and mouse for second computer.

Suppose, you and your friend are making company accounts in two computer but second computer's keyboard and mouse is not operating, at that time, you can operate second computer with your own keyboard and mouse and you can complete the accounting work of second computer.

Now, let's to understand the way to share keyboard and mouse with two computers:

# First important thing is that Internet of two computer must be connected  with same modem. If you are unable to create networking between two computer, then first of all, please learn this at here.

1. Share Keyboard and mouse with use of teamviewer software

 download teamviewer in both computer by simple search of download teamviewer on google and install it in both computer. Then, use first computer's teamviewer id and password and fill it in second computer. After this, you can see your second computer window and you can operate both the computer with same keyboard and mouse. Now, you just what will I do in the front of you.



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2. Share Keyboard and mouse with use of copy of Input Director

It is designed for folks who have two (or more) computers set up at home and find themselves regularly sliding from one system to the other (and wearing out the carpet in the process!). With Input Director, you can share a single keyboard/mouse across a set of systems. You switch which system receives the input either by hotkey or by moving the cursor so that it transitions from one screen to the other (in a very similar fashion to a multi-monitor setup). The idea being that you can position the monitors from two or more systems in a row and use a shared keyboard/mouse to control all of them.

By using this method, you have to complete following steps :

Ist step :  Installing Input Director

2nd step : Configuring Input Director

3rd step : Configuring the Slave

4th step : Configuring the Master

read detail of above steps at here.

Related : Shut Your Home Computer with Office Laptop

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Accounting in Vedas

Sufficient evidence exists to lead one to conclude that the art and practice of accounting, as a highly developed system, was in vogue in India even during thetimes of the Vedas, Sutras and the Upanishads…
The discussions in the Vedas about matters like the system of land tenure, currency, trade, various occupations as well as the general social and economic conditions in those times are
indicative of the existence of a highly developed system of record keeping.

“Sale appears to have regularly consisted in barter in Rig veda; 10 cows are regarded as a possible price for an image of Indra to be used as a fetish. The haggling of the market was already familiar in the days of the Rig veda, and a characteristic hymn of the Atharvaveda, is directed to procuring success in trade. Price was referred Accounting Existed In Vedic India to as a Vasna and the Merchant, Vanij.

“An arithmetical progression of some interest is found in the Panchavimsa Brahmana, where occurs a ‘list of sacrificial gifts’ in which each successive figure doubles the amount of the preceding one...
Vikraya is found in the Atharvaveda and the Nirukta denoting ‘sale’. Sulka in the Rig veda clearly means ‘price’. In the Dharma Sutras it denotes a ‘tax’.

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How to Use Samsung Digital Camera

In the beginning of new year, I bought new samsung digital camera for making my accounting lecture vidoes. Quality of this samsung digital camera is very good and you can carry it anywhere because its weight is just like pocket mobile. There is also no need of cells because it has battery of 4.2 V which you can charge. There is also 4 G memory card in it. So, for online teacher, it is very useful tool for online teaching. If you are new buyer of samsung digital camera, you need to learn its functions. So, I am telling the steps of using samsung camera:

1st  Start and Shoot a picture

For starting digital camera, please press power button which you can see initial setup screen. For shooting a picture rotate the mode dial to auto icon in digital camera and press ok button.

2nd  Make Video

For making video, you have to rotate the mode dial to video icon in digital camera. You can zoom the live video by adjusting left or right to ok button. After pressing ok button, video will start and you will see the red light on monitor of digital camera. For stopping the video, you should again press ok button.

3rd  Use of Second Monitor

For using second monitor, you can press F.LCD button before starting to capture video or picture. This button, you can find near power button.

4. 10 Second Timing of Picture and Video

This timing is useful for adjusting yourself for digital camera. With using button below the menu, you can do this.

5th Multi slide show

You can also enjoy your digital camera but adding effect and music in it and play multi slide show.

Warnings

• Do not use your camera near flammable or explosive gases and liquids
• Keep your camera away from small children and pets
• Prevent damage to subjects' eyesight
• Handle and dispose of batteries and chargers with care

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Show Me The Money: How California Schools are Funded

California already spends less than most states on its education system. And that was before the Governor proposed cutting $4.8 billion more out of the system for 2008-09.

Where does that money come from? Where is it spent? How is it distributed? This video is a short introduction to the crazy California school finance system.

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Working Capital Requirement

To know working capital requirement is very important for operating business without any risk. Because less or over working capital than exact working capital requirement is harmful for the progress of any business. In simple words, working capital requirement means exact amount of cash or other liquid asset to operate the business. If you have required money in the pocket of business, you need not worry for paying expenses, paying for raw material and other creditors.

Now come to the point "how to calculate working capital requirement?"

It is totally based on the nature of business. Requirement of working capital may differ in different type of business. I often compare working capital as petrol in your car. If you have to drive your car in local area, you need less petrol but if you want to travel highway for long, you need more petrol. Like this, if your business credit deal is more, then you require more capital, because one side you are buying credit and other side selling on credit. But it is not true that all debtors will convert in cash. One the other side you have to pay your full dues. So, you need big amount of working capital requirement. Minimum double of credit purchase amount. But, if you calculate average collection period and if it is less than average payment period, then you can keep less cash in your pocket.

Simple formula of working capital requirement

WCR = [Accounts Receivable + Inventory + Prepaid Expenses] - [Accounts Payable + Accruals]

You must study following points before calculating working capital requirement

1. The average time Raw materials are in stock
2. Average time to produce goods or service
3. Average time finished goods in stock
4. Credit Terms from suppliers
5. Average credit terms offered to customers
6. Estimated sales next month
7. Net Profit Margin

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Video Lecture on Finance

Finance is very deep subject and it acts as the lifeblood in the modern world business. We can make specialization on  this subject on based on our continually study finance topics updates. Video is good source of seeing updates and understand the learning topic. So, I published many video lectures on finance in youtube and republished in this site for site readers' reference. Today lecture on finance has been made for explaining the main elements of finance map and their relationship with each other.

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How to Teach Financial Literacy

Teaching of financial literacy is very important for making students more confident in finance. Students' future will become financial and economically sound, if they know the finance and its basics. Only developing the financial skills, they will enable to manage financial risks. Now there are many sources, from where students can get financial literacy. But I did hard work more than 3 months for making Finance Map to teach financial literacy to young students. If any financial teacher  follows this finance map, he will surely succeed to teach financial literacy. In this finance map, we make different steps which are very needed to teach to students.

 Here, I am again explaining its different steps :

1st Step : Teach Basics of Finance

There are 15 things which come under basics of finance. First of all, finance teacher should teach these things one by one. Many students still do not know fund, money and saving. Fund means any asset in the form of money which is kept for special purpose. But money is not fund . Only Cash, cheques and currency notes are the major things of money. Saving is also different from fund and money. It refers not to consume all earning and keep some part of it in bank or in home or in business, so that it can be used for emergency time. So, please following basics of finance should learn for teaching.

1. Fund
2. Money
3. Saving
4. Cash
5. Bank
6. Interest
7. Dividend
8. Reserves
9. Assets
10. ROI
11. Retained Earning
12. Investment
13. Mutual Fund
14. Hedge Fund
15. Venture Capital
→
2nd Step : Teach Sources of Finance

Sources of finance means the way from where we get money for development of our business. To teach sources of finance is second step of teaching financial literacy. It implies that student should know plus and minus points of each source of finance and after this, they can decide to take better source of finance. In this list, I have included 7 things.

1. Stock/ Equity
2. Debt
3.  Bond
4. Credits
5. Advances
6. Bank Finance
7. Public Deposits
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3rd Step : Teach the Tools of Finance

With tools of finance, finance teacher explains financial management. All the companies have to take decision for flowing cash and fund. Only finance tool can explain whether past decisions are good or not. For example if we study ratio analysis, profitability ratio expresses current earning on the basis of total sale. So, we can take decision for increasing our return. In this learning list, I included 11 things.

1. Financial Analysis
2. Financial Planning
3. Financial Statements
4. Ratio Analysis
5. Cash Flow Analysis
6. Fund Flow Analysis
7. Working Capital Management
8. Cash Budgeting
9. Treasury Management
10. Inventory Management
11. Debtor’s management

4th Step : Teach Techiques of Investment Decisions

Big flow of cash and fund is always in investment. So, investment decisions is very important from returning point of view. A small mistake in investment decision can liquidate any company. To teach the techniques of investment decisions means to teach different methods of capital budgeting and many other things which are mentioned in following link list

1. Capital Budgeting
2. Pay Back Period
3. Rate of Return
4. Net Present Value
5. Profitability Index
6. Internal Rate of Return
7. MIRR
8. Equivalent Annuity
9. Cut off Rate
10. Investment Analysis
11. Capital Rationing
12. Project Planning
13. Decision Tree Analysis
14. Real Option Analysis
15. APT
16. CAPM

5th Step : Teach Different Financial Markets

Now, financial markets has reached at international level where we can deal in everything no physical transfer is needed. Just fluctuation in prices will decide your profit or loss in specific deal. So, it is needed to teach all updates of financial markets. I have studied 12 financial market and included in following link list.

1. Capital Market
2. Stock/Equities Market
3. Bond Market
4. Foreign Exchange Market
5. Derivatives Market
6. Commodity Market
7. Money Market
8. Spot( Cash ) Market
9. OTC Market
10. Real Estate Market
11. Insurance Market
12. Private Equity

6th Step : Teach Sources and Applications of Public Finance

As a good citizen of any country, it is your duty to check the sources and application of govt. finance. For this investigation, you need to know about the sources and applications of public finance. Without this, you can not understand the fiscal policy of govt. So, it is duty of your finance teacher to teach your about the sources and applications of public finance. With this, you can open the consipiracy of govt. if it misuses the public money.

1. Income Tax
2. VAT
3. Government Budgeting
4. Government Bonds
5. Fiscal Policy
6. Government Investment
7. Government Spending
8. Government Debt
9. Seigniorage

7th Step : Teach Other Advance Things of Finance

For teaching financial literacy deeply, teacher should teach other advance things of finance to students. In these things, we can includes financial risks and its management, personal finance tools and study of financial institution of each country. 

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