General Concepts 2 min read
How to read P&ID?
As a graduate chemical engineer, you are expected to know how to read a P&ID. Learn to read before you…
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Basics 5 min read
What is meant by reconciling an account?
Reconciling an account often means proving or documenting that an account balance is correct. For example, we reconcile the balance in the general…
Basics 5 min read
What is included in cash and cash equivalents?
The term cash and cash equivalents includes: currency, coins, checks received but not yet deposited, checking accounts, petty cash, savings accounts, money market accounts,…
Basics 5 min read
What is principles of accounting?
Three meanings come to mind when you ask about principles of accounting… 1. Principles of Accounting was often the title of the…
Basics 8 min read
What is the difference between an implicit cost and an explicit cost?
An implicit cost is a cost that has occurred but it is not initially shown or reported as a separate cost. On…
Basics 6 min read
What are prepaid expenses?
Prepaid expenses are future expenses that have been paid in advance. You can think of prepaid expenses as costs that…
Basics 4 min read
What are nonmanufacturing overhead costs?
Nonmanufacturing overhead costs are the business expenses that are outside of a company’s manufacturing operations. These are often referred to…
Basics 6 min read
What is the difference between product costs and period costs?
A manufacturer’s product costs are the direct materials, direct labor, and manufacturing overhead used in making its products. (Manufacturing overhead is also referred to as…
Basics 5 min read
What is the meaning of equity?
Equity is used in accounting in several ways. Often the word equity is used when referring to an ownership interest in a…
Basics 5 min read
What is the cost of sales?
Cost of sales is the caption commonly used on a manufacturer’s or retailer’s income statement instead of the caption cost of goods…