If a company is using the accrual basis of accounting, then as an investor, one can be sure that the company’s current affairs are the most accurate. Accrued expenses are recorded as accounts payable in a business’s balance sheet. Just like accrued income, accrued expenses are recorded at the time the financial commitment is made,…

In contrast, LIFO results in higher COGS and lower reported gross income. Using HIFO can lower taxable income by prioritizing the sale of higher-cost inventory, reducing gross profit. However, this can also lower net income, potentially affecting financial ratios and investor perceptions. Sell Through Rate: A Key Metric for Inventory Management This means that ‘first…

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They also promote transparency between the board and members or it can also be a law requirement. The frequency of preparation of HOA financial statements may vary depending on state laws, community bylaws, and the size of the association. The choice between cash basis and accrual basis accounting will significantly impact your HOA’s financial management.…