Basics of Accounting

The Tier 1 capital ratio compares the core equity capital of a banking entity to its risk-weighted assets. The ratio is used by bank regulators…

Straight line amortization is a method for charging the cost of an intangible asset to expense at a consistent rate over time. This method is…

EBITDA Coverage Ratio is a solvency ratio that measures a company’s ability to pay off its liabilities related to debts and leases. It compares the…

The EBITDA coverage ratio measures the ability of an organization to pay off its loan and lease obligations. This measurement is used to review the…

A bad debt recovery is a payment received after it has been designated as un-collectible. This may occur after legal action has been taken to…

Percentage of Sales Method Example: The company estimates bad debt based on the percentage of sales method. Sales for the fiscal year ended December 31,…

The Return on Total Capital compares the profitability of a business to the aggregate amount of funds invested in it. The concept is most applicable to…

Accounting period: the period of time, typically a year, over which an organisation records revenues and expenses, cash flows and changes in assets and liabilities.…

Accountability is the extent to which a named individual is held responsible for the success or failure of a policy or a piece of administration.…