Archive for category: Accounting

RELEVANT COSTS AND BENEFITS Every decision involves choosing from among at least two alternatives. A relevant cost or benefit is a cost or benefit that differs, in total, between the alternatives. Any cost or benefit that does not differ between the alternatives is irrelevant and can be ignored. Relevant costs and benefits are also known as differential costs and benefits. Avoidable costs are those [...]

STEPS FOR IMPLEMENTING ACTIVITY-BASED COSTING Define activities, activity cost pools, and activity measures. Assign overhead costs to activity cost pools. Calculate activity rates. Assign overhead costs to cost objects using the activity rates and activity measures. Prepare management reports. COST HIERARCHY Unit-level activities are performed each time a unit is produced. The costs of unit-level activities should be proportional to [...]

[facebook] Installment Notes Payable [dropcap style="font-size: 60px; color: #9b9b9b;"] L [/dropcap]oans that require payment of principle and intrest at regular intervals are typically represented by installment notes. The terms for these type of notes usually range from two to five years. Well, let us start with example, let us assume XYZ company burrowed $10,000 from a bank. In exchange, XYZ [...]