Understanding Double-Entry Accounting and Financial Accounts
Early Double-Entry Accounting
- Assets must be recorded on the debit side.
- Liabilities must be recorded on the credit side.
- Outflows are recorded on the debit side.
- Income is recorded on the credit side.
- Equity is recorded on the credit side.
- Everything that comes out of an account must be balanced.
- Columns must be balanced.
Accounts
Assets
Cash and Bank Accounts
Accounts used to record deposits in checking accounts at national banks or abroad, freely available funds, and others that serve as payment.
- Cash: Cash
Understanding Business Investments and Financial Resources
The rental income for this method is 100% tax deductible, and there is no minimum duration of the lease. At the end of the contract, the lessee company is given the option of renting equipment to replace or renew the contract for a further period to be determined. Unlike leasing, no lessee can purchase at the end of the contract.
Distinguishing Between the Cost of Outside Resources and That of Resources
Most of the resources used by the company involve a cost. The company will try to get that source
Read MoreAccounting Standards for Inventory Valuation and Impairment
Buying Valuation Rules (Rule 10 of the PGC and 12 of the PGC for SMEs)
- All expenses for shopping, whatever their nature, even when VAT is not recoverable, will be charged to account 600 (purchases of goods), increasing the purchase price.
- The financial costs (interest) can only be attributed to the purchase price if you are with conviction, not exceeding one year and not have a contractual interest rate. If you are long term, applies the rules of valuation of assets, therefore, be charged the cost
Key Concepts in Economics: Impact on Supply, Demand, and Production
1. How Does Product Quantity Demanded React to Increased Prices of Complements?
Explanation: Complementary products are goods that are often used together (e.g., printers and ink cartridges, or coffee machines and coffee pods). When the price of one complementary good increases, the overall cost of using the associated product bundle also increases.
Effect on Demand: An increase in the price of one complementary product reduces the demand for the other complementary product. For example, if the price
Read MoreStrategic Planning and Market Segmentation for Business Success
Strategic Planning
Strategic planning is the process of developing and maintaining a strategic fit between the organization’s goals and capabilities, and its changing marketing opportunities.
Cash Flows and Desired Movement in BCG Matrix
Problems with Matrix Approaches
- Difficulty in defining SBUs and measuring market share and growth
- Time consuming
- Expensive
- Focus on current businesses, not future planning
Because of these problems, many companies have dropped formal matrix methods in favor of more customized
Read MoreMarket Dynamics: Competition, Supply, and Demand
Characteristics of Market Lambs
- Homogeneity: If the consumer goes down in price or other aspects, it can be different. Now, the specific characteristics can be objective or subjective.
- Perfect Information: If the consumer knows all the characteristics and conditions, and the company that offers them is uniform, it is easier to have perfect information. We look only at the price.
- Entry Barriers: Obstacles that exist to dedicate oneself to some activity (legal barriers, capital, a very prestigious company,