discounted payback period criteria of capital budgeting. The payback period measures the time that it takes to recoup the cost of the investment. If the cash flows are an annuity, then we can simply divide the cost by the annual cash flow to determine the payback period Otherwise, as in the example, we subtract the cash flows from the cost until the remainder is zero The shorter the payback period, the better Generally, firms will have some maximum allowable payback period against
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Prudence Concept Prudence means being careful or cautious. The prudence concept is an ethical concept that is based on the principle that revenue and profits are not anticipated, but are included in the income statement only when realized in the form of cash or other assets, the ultimate cash realization of which can be assessed with reasonable certainty. Provision must be made for all known liabilities and expenses, whether the amount of these is known with certainty or is a best estimate in the
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Excellence in Financial Management Course 2: Financial Planning and Forecasting Prepared by: Matt H. Evans, CPA, CMA, CFM This course provides a basic understanding of how to prepare a financial plan (budgeted financial statements). This course will also discuss some of the problems associated with budgeting along with "best practices" in budgeting. This course is recommended for 2 hours of Continuing Professional Education. In order to receive credit, you will need to pass a multiple
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Accounting Theory The purpose of this chapter is to identify those characteristics of accounting information that are thought to make one system of accounting better than another. Since the material is based on eighty years of accounting research, by countless researchers, it is clearly neither possible nor desirable to review all the arguments, or even the main arguments, used by advocates of all the different competing accounting systems. For instance, it would be difficult to improve on Henderson
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Accounting, Ethics, Business Entities, Financial Statements Accounting for Transactions –Part 1 Accounting for Transactions –Part 2 Accounting for Adjustments- Part 1 Accounting for Adjustments- Part 2 Completion of Accounting Cycle Accounting Systems Revision Chapters 1 - 4 Accounting for Retailers Accounting for Inventories Non-Current Assets Cash Management and Control Accounting for Receivables Tutorial Exercises Lecture Notes Week 1 Introduction to Accounting, Ethics, Business Entities, Financial
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Financial Statements Analysis - An Introduction MODULE - 6A Analysis of Financial Statements 27 FINANCIAL STATEMENTS ANALYSIS - AN INTRODUCTION You have already learnt about the preparation of financial statements i.e. Balance Sheet and Trading and Profit and Loss Account in the module titled ‘Financial Statements of Profit and Not for Profit Organisations’. After preparation of the financial statements, one may be interested in analysing the financial statements with the help of different tools
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Chapter 07 Foreign Currency Transactions and Hedging Foreign Exchange Risk Multiple Choice Questions 1. According to the World Trade Organization, what was the size of international trade in 2008? A) $7,000,000,000 (7 billion dollars) B) $70,000,000,000 (70 billion dollars) C) $37,000,000,000 (37 billion dollars) D) $16,000,000,000,000 (16 trillion dollars) Answer: D Level: Easy LO: 1 2. In the years between 1990 and
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strategic theory: strategic decision; strategy; strategic analysis; strategic decision process. STRATEGIC DECISION A strategic decision is a decision that has long term, significant and non-reversible effects on the final goal of the organization (decision maker) and usually required large amount of resources. It costs significantly in term of time, money and opportunity to achieve a goal. The focus is also on the effects of your decision: considering the business demand, moving a machinery
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Chapter 2: Basic Financial Statements: I. Self-Test Question: 1. 2. A.c.d 3. B 4. B,d 5. C 6. B,c 7. B,d 8. A 9. A,b,d II. Discussion Question: 1) The purpose of accounting is to accumulate and report on financial information about the performance, financial position, and cash flows of a business. This information is then used to reach decisions about how to manage the business, or invest in it, or lend money to it. 2) Because most managers
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identified through data provided in formal records called financial statements. Financial statements provide an accurate account of a company’s financial position and cash flow of the business. Stakeholders used the data to make decisions regarding future purchases, investments, and profitability of the organization. Analyzing financial statements consists of using various methods (statistical tools) including comparative statements, schedule of changes in working capital, common size percentages
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