The FIFO inventory method stands for First in First Out, where costs accrued first will be paid out before those acquired later. Learn how to identify equivalent units using this method, and how to develop a production cost report as well. The first... Read more
Accountingo.org aims to provide the best accounting and finance education for students, professionals, teachers, and business owners. Elements of financial statements are not isolated sections of information but are closely linked to one another. A... Read more
Specialties include general financial planning, career development, lending, retirement, tax preparation, and credit. Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive... Read more
Let us now take another example to illustrate the computation of the payout ratio. During the year 2019, the company registered a net income of $40 million and decided to retain back $28 million in the reserve while paying out the rest as dividends... Read more
The shorter the payback period, the more likely the project will be accepted – all else being equal. The two calculated values – the Year number and the fractional amount – can be added together to arrive at the estimated payback period. If undertak... Read more
Kanban uses cards (paper or digital) to track the progress of production on a factory floor. As inventory moves through the manufacturing process, Kanban cards reflect that progress and can signal when it’s time to order more stock. Note that... Read more
You can rest assured that your financial records are safe and secure with Wishup. Liabilities and Equity are the opposite, they are “credit” items. So, every time a liability rises, you “credit” that line item, and when it i... Read more
An adverse labor rate variance indicates higher labor costs incurred during a period compared with the standard. Direct labor costs are defined as a cost of labor that goes directly into the production or manufacturing of a good. These include the w... Read more
The unfavorable variance tells the management to look at the production process and identify where the loopholes are, and how to fix them. Any positive number is considered good in a labor efficiency variance because that means you have spent less t... Read more
Differential cost is the same as incremental cost and marginal cost. The difference in revenues resulting from two decisions is called differential revenue. In the case of ABC Company, moving to television ads and social media marketing exposes the... Read more
