Explain the various accounting concepts and examine the role of accounting concepts in the preparation of financial statements.
Answer. Accounting concepts are the required assumptions or conditions on which accounting is based..............
Information which is used in accounts is originally entered into books......
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Explain the meaning of fund flow statement. How would you compute funds from operations in order to prepare sources and usage statement of funds?
Answer. Fund flow Statement allows you to measure the various sources of funds. The fund flow statement is also termed as....... It clearly shows the movement of funds in an accounting period......
What is CVP analysis? How does it differ from break-even analysis?
Answer. CVP analysis is a technique which can be employed by business managers to make better business.........
It splits the costs into those that are fixed and the ones that are variable and then...................... A formula which allows for CVP analysis can be easily....
An analytical statement of Altos Limited is shown below. It is based on an output (sales) level of 80,000 units.
| Sales | 9,60,000 |
| Variable Cost | 5,60,000 |
| Revenue before fixed costs | 4,00,000 |
| Fixed Costs | 2,40,000 |
| 1,60,000 | |
| Interest | 60,000 |
| Earning beore tax | 1,00,000 |
| Tax | 50,000 |
| Net Income | 50,000 |
Calculate the degrees of (i) operating leverage, (ii) financial leverage and (iii) the combined leverage from the above data.
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