Accountancy

A company’s merchandise, raw materials, finished and unfinished products which have not yet been sold is known as Inventory.

Accounts receivable & inventory are the examples of Current assets. Current assets include cash, cash equivalents, accounts receivable, stock inventory, marketable securities, pre-paid liabilities, and other liquid assets. Current assets are important to businesses because they can be used to fund day-to-day business operations and to pay for the ongoing operating expenses.

The owner of consignment stock is Consignor.

Money spent to acquire or upgrade physical assets is known as Capital expense, as the asset is expected to be utilised in a long run.

Accrued expenses account with normal balance is shown at the credit side of a trial balance.

The process of entering all transactions from the Journal to Ledger is called Posting. Posting refers to the process of transferring entries in the journal into the accounts in the ledger. Posting to the ledger is the classifying phase of accounting.

Earned but not yet received income is treated as Asset. It is income earned during a particular accounting period but not received until the end of that period. It is treated as an asset for the business.