Debenture holders are creditors because they have lent money to the company through the sale of Debentures. Creditor means an entity that has a claim to receive money from another. In this case, it would be an individual who has purchased a Debenture from the company. Often, a sinking fund[...]

With a long-term view, businesses can better assess these decisions’ potential risks and rewards. The manufacturing budget includes all the costs involved in manufacturing the number of products specified in the production budget. The manufacturing budget is crucial for managing production costs, optimizing production efficiency, and achieving profit margins. In[...]

Suppose that X limited produces a product X and uses labor hours to assign the manufacturing overhead cost. The estimated manufacturing overhead equipment lease accounting under asc 842 trullion was $155,000, and the estimated labor hours involved were 1,200 hours. Enter the total manufacturing overhead cost and the estimated units[...]

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A country with a large trade surplus is exporting capital and running a capital account deficit, which means money is flowing out of the country in exchange for increased ownership of foreign assets. The first part of knowing what to debit and what to credit in accounting is knowing the[...]

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If it’s publicly held, this calculation may become more complicated depending on the various types of stock issued. This is basically the amount left over when you subtract Total Liabilities from Total Assets. In includes the owner’s investment(s) and retained earnings (the portion of the profits reinvested in the business).[...]

In other words, the ratio alone is not enough to assess the entire risk profile. While a useful metric, there are a few limitations of the debt-to-equity ratio. As you can see from the above example, it’s difficult to determine whether a D/E ratio is “good” without looking at it[...]