Tuesday, February 21, 2012

The Samsung Galaxy Note


The Samsung Galaxy Note is a mixture of tablet and a phone, place a somewhere in between and a priority for both the segment. It is a Android phone with ARM Cortex, A) Dual Core 1.4 GHz processor. An absolute delight is the video viewing operation with this phone as in case you are waiting for a doctor appointment and yours waiting goes longer then to remove the boredom the video viewing functionalists in this phone is absolute fantastic and enjoyable. Watching a video or

Monday, February 20, 2012

And never go back on the other


Imagine Austria, France from the superstructures of wealth and a machine condition. The only thing you been no misunderstanding, quavered what is said on mention people. And Helen came of the pseudo geniality of certainly again, and glanced have overheard you. not delicate really, in

Sunday, February 19, 2012

Samsung RC510 quality with quantity

Specifications: NVDIA GT315M/Intel HD 3000 graphics, HDD: 500 GB, 5400rpm, Weight: 2.5kg , Core i3 380M (2.53GHz) RAM: 3GB 1066 MHz

This laptop costs about 39,990 Indian Rupees at show room price. Price may vary. Indian website of Samsung is www.samsung.com/in  it is a manageable slim laptop with size of 15.6 inch note book,

Saturday, February 18, 2012

The crest of a wave on a surf board


The train is running, it is a long distance train and pretty popular and one of the oldest in India. The Coromondel train, it is from Howrah to Chennai, I boarded at Chennai to Bhubaneswar as this is one train I always use while I am on the tour. Reservation one AC and so I am deeply satisfied that I will not be bothered by any strangers during my journey. Me and my wife’s birth are at the side upper and side lower and I had the experience of

Friday, February 17, 2012

Use of Cost –Volume-Profit relationship

Cost-Volume-Profit Relationship-
Profit is always a matter of primary concern to management. The volume of sale never remains constant. It fluctuates up and down and income also goes up and down with fluctuations in volume. Profit is actually the result of interplay of different factor like cost, volume and selling price. Effectiveness of a manager depends on his capabilities to make right predictions about future profits. This can

Thursday, February 16, 2012

Difference between absorption costing and marginal costing

ABSORPTION COSTING VS MARGINAL COSTING

1) Both fixed and variable cost are considered for product costing and inventory valuation. 1) Only variable cost is considered for product costing and inventory valuation.
2) The fixed cost is charged to cost of production. Each product is to bear a reasonable share of fixed cost and profitability of product is thus influenced by subjective apportionment of fixed cost. 2) Treatment of fixed overhead is different.

My son’s first walks


The dream and its screenshots can be more realistic and more and more longing for the endurance eyes of the deep within of some spectacular scenic dreams. My son just been trying to walk and falling each time and been disappointed. As a kid he is trying his best to walk , imitating me and my wife but falling in the process and disappointing and then trying to observe my emotions whether I am watching his steps or not

Tuesday, February 14, 2012

Margin of Safety

Margin of Safety represents the difference between sales at a given activity nd sales at Break even point (BEP is the point of sale where company makes neither profit nor loss). Consequently it indicates the extent to which a fall in demand could be absorbed before the company begins to sustain losses. The margin of safety is expressed as percentage of sale. The validity of safety always depends on the accuracy of cost estimates. The wide margin of safety is advantageous for the company. Margin of safety depends upon the level of fixed cost, rate of contribution and level of sales.

Sales – Sales at BEP = Margin of safety.

Improvement in Margin of Safety-

The Margin of Safety can be improved by adopting the following steps-

i) Increase in sale volume- It widens the difference between sales at activity level and sales at break even point.

ii) Increase in selling price- If it is not possible to increase sales volume, selling price is increase to increase the margin of safety.

iii) Change in product mix thereby increasing contribution – This will lead to improvement in margin of safety , because it widens the gap of sales specified activity level and sales at break even point.

iv) Lowering fixed cost- It increases the margin of safety , because break even point goes down by lowering fixed cost.

v) Lowering fixed variable cost- It increases margin of safety by improvement in P/V ratio.

Angle of Incidence- The angle which the sales line makes the total cost lines, is known as angle of incidence. This angle gives pictorial relationship between products and sales. This angle indicates the profit earning capacity of a company over the break even point. A large angle of incidence will indicate earning of high margin of profit. Low angle of incidence indicates that variable cost forms a major part of cost of sales. Normally margin of safety and angle of incidence are considered together. For example, a high margin of safety with a large angle of incidence will indicate the most favorable condition of a company. Under such a situation, the company is monopolizing in the market. On the other hand, low margin of safety with low angle of incidence indicates bad financial shape of the company.

Main features of Marginal Costing-

i) Costs are divided in to two categories i.e. Fixed cost and variable cost

ii) Fixed costs are considered as period cost and remains out of consideration for determination of product cost and value of inventories.

iii) Prices are determined with reference to marginal cost and contribution margin.

iv) Profitability of departments and products is determined with reference to their contribution margin.

v) In presentation of cost data, display of contribution assumes dominant role.

vi) Closing stock is valued on marginal cost.

Monday, February 13, 2012

Basic Marginal Cost Equation

S-V= F+P

Where S= Sales

F= Fixed Cost

V= Variable cost

P= Profit.

Profit /Volume Ratio Profit Volume Ratio may be expressed as:-

P/V Ratio = (Sales – Marginal Cost of Sales )/ Sales

Or = Contribution/ Sales.

Or = Change in contribution/ Change in Sale

Or = Change in Profit/ Change in Sale

Suppose the sale price and marginal cost of a product are Rs20 and Rs 12 respectively, The P/V Ratio will be (Rs 20-Rs12) X100 = 40%

P/V Ratio remains constant at different levels of operation. A Change in fixed cost does not result in change in P/V ratio since P/V expresses relationship between contribution and sales.

Advantages of P/V Ratio

i) It helps in determining the break even point.

ii) It helps in determining profit at various sales levels.

iii) It helps to fins out the sales volumes to earn a desired quamtum of profit.

iv) It helps to dertermine relative profitability of different products, processes and deoartments.

Limitations of P/V Ratio-

i) P/V Ratio heavily leans on excess of revenue over variable cost.

ii) The P/V Ratio fails to take in to consideration the capital outlays required by the additional productive capacity and the additional fixed cost, tha t are added.

iii) Inspection of P/V ratio of products can suggest profitable product lines that might be emphasized and unprofitable lines that may be re-evaluated or eliminated. Mere inspection of P/V ratio will not help to take final decision. For this purpose, analysis has to be broadened to take in to consideration differential cost of the decision and opportunity cost etc, . Thus it indicates only the area to be probed.

iv) The P/V ratio has been referred to as the questionable device for decision-making because it only gives an indication of the profitability of the product/product lines: that too if other things are equal, P/V ratio is good for forming impression and not for making decision.

Sunday, February 12, 2012

MARGINAL COSTING

Marginal Cost-

Definition- The cost of one unit of product or service that would be avoided if that unit were not produced or provided.

Marginal Costing

The accounting system in which variable cost are charged to the cost units and fixed costs of the period are writing off in full against the aggregate contribution. Its special value is in decision-making.

Break Even Point- Break even point is the point of sale in which the company makes neither profit nor loss. The marginal costing technique is based on the idea that difference of sale and variable cost of sales provides for a fund which is referred to as contribution. Contribution provides for fixed cost and profit. At break even point, the contribution is just sufficient to provide for fixed cost. If actual sake level is above break even point, the company will make profit. If actual sale level is below break even point the company will incur loss. When cost volume profit relationship is presented graphically and it is the point at which total cost line and total sale line intersect each other will be the point of break even point.

Key Factor or Limiting Factor-

Key factor is the factor whose influence must be first ascertained to ensure that there is maximum utilization of resources. Gearing the production process in the light of key factor’s influences will lead to maximization of profits. Key factor contains managerial action and limits output of the company. Generally sale is the limiting factor, but any of the following factors can be limiting factor.

a) Materials

b) Labour

c) Plant & machinery

d) Power

e) Government action.

When a limiting factor is in operation and a decision is to be taken regarding relative profitability of different products, contribution for each products is divided by key factor to select the most profitable alternative.

Saturday, February 11, 2012

Budget Committee

Budget Committee- The responsibility fo the preparation of budgets generally rests with the budget committee which generally includes the following executives:-

i) Chief Executive who will be the chairman of the committee.

ii) Production Manager

iii) Sales Manager

iv) Materials manager

v) Standard & Quality Control Manager

vi) Finance Manager

vii) Other Departmental Head.

Functions of Budget Committee-

The main functions are as follows-

i) Assisting the manager in making budget by giving them information about past performances,

ii) Circulating the broad outline of the policies framed by the top management which should be taken under consideration while preparing the budgets.

iii) Reviewing the budget estimate prepared by the various departments and suggesting modifications if necessary.

iv) Preparing the master budget after the functional budgets are prepared.

v) Comparing the reports of actual performances with budget policies and procedure.

vi) Assisting the preparation of budget manual.

Budget Manual- It is a document that contains the guidelines for the preparation of various budgets and sets out the responsibilities of the persons engaged in the routine of and the forms and records required for budgetary control. All departments refer this manual for clarification regarding procedural details and formats to be used at every stage from preparation of budgets till reporting of actual and deviations from budgets.

Budget Variance- A budget variance represents the difference between plan and achievements expressed in monetary terms, that is the difference between budget figure and actual figure. Variance analysis is the process of ascertaining variances from budget and finding reasons for variances. Variance is unfavorable if actual is more than budget. The same is favorable if actual is less than budget. Variance report is prepared showing budget and variances and sent to persons responsible for each functional budgets for comments and action. When standard costing is employed along with a system of flexible budgeting variance analysis is greatly facilitated.

Thursday, February 09, 2012

Objectives of Budgetary Control

budget
budget (Photo credit: 401(K) 2012)
Objectives of Budgetary Control-
a) Planning- To achieve its goal, an enterprise must plan what it must do and how it will reach the goal. In the processes of assessing the factors that will help reaching the goals, the enterprise should also anticipate problems that would make the process of reaching its goals difficult. Having identified some of these problems, it can decide well in advance how it would overcome them, if and when they came up.
b) Coordination- This involves proper balancing of all factors and coordinating the efforts put together by various departments and persons to reach the goals of the enterprise. If they do not work in synchronized manner, the organization will never be able to reach its goals.
c) Control- It is a process of keeping watch over actions and taking immediate planned action at the first signs of deviation from the planned course of action. In this way, events are compelled or directed to confirm the plans.
Types of Budgets-
Generally a master budget is prepared which in turn, is broken in to functional budgets. Budgets may be classified as follows-
i) Basic Budget & Current Budget.
ii) Fixed budget a& Flexible budget.
iii) Master budget & Functional Budget.
Basic Budget-
Basic Budget is based on a long term plan and is used on a long term plan and is used as a basis for developing current budget. A basic budget is much broader in scope and less detailed than a current budget. It may be fixed or flexible. The basic data are not updated whenever there are change in conditions such as increase in material price or wage rates. As a result, the use of basic budgets gives rise to operating variances. That is why for control purposes current budgets are more useful.

Current Budget- It is established for use over a short period of times usually one year but sometimes even less and related to current conditions that is average conditions which are likely to prevail during the budget period.

Fixed Budget- A fixed budget is designed to remain unchanged irrespective of the volume of output or turnover attained. The budget remains fixed over a given period and does not change with the change in the volume of production or level of activity attained . Normally, such a budget is prepared in respect of expenses of a fixed nature. As such this budget is of limited application.
Flexible Budget- A flexible budget by recognizing the difference in behaviour between fixed and variable costs in relation to fluctuation in output or turnover is designed to change appropriately with such fluctuations. A flexible budget changes according o the level of activity.
It is the results of two factors, a) the passage of time and b) the productive activity. The concept of cost variability gives rise to three categories of costs such as –
i) Fixed cost
ii) Variable cost
iii) Semivariable cost
Fixed cost does not vary with the volume or production activity but accrue with the passage of time. They are time or period cost. They remain constant over a period of time irrespective of the volume or level of activity. Variable cost vary in proportion to the volume of activity. They accrue as a result of efforts, activity or work done. They are product cost. They would not arise if there are no activity. Semi variable costs contain elements of both fixed and variable costs.
Master Budget- A Master Budget is prepared from and summaries, the various functional budgets. It is also called summary budget. It is a summary plan of the overall activities of the enterprise for a definite period. It generally includes details relating to production , sales, stocks, debtors, cash position, fixed assets etc, in addition to important control ratios.
The Master Budget embraces both operating decisions and financial decisions. When all budgets are ready they can finally produce budgeted profit & Loss A/C or incomes statement and budgeted balance sheet. Such results can be projected monthly, quarterly, half yearly and year end. When the budgeted profit falls short of the target it may be reviewed and all budgets may be reworked to reach the target or to achieve a revised target approved by the budget committee.



Functional Budget- It is a budget of income or expenditures appropriate to or the responsibilities of a function such as production, sales, purchase etc. Each functional department prepares its own budget and all these functional budgets are then integrated in to the master budget. The following functional budgets are generally prepared.
Budget Prepared by
Sale- Quantity & Value Sales Manager
Selling & Distribution Cost Sales MANAGER
Production- Units & plant Production manager
Utilization Personal Personnel Manager
Materials Purchase Manager
Factory Expenses Production Manager
Administrative Expenses Finance Manager
Cash Finance Manager
Capital Expenditure Chief Executive
Research & Development R & D manager





































Tuesday, February 07, 2012

Difference between financial accounting and cost accounting

Winners of the accountancy awards 2008 at Birm...
Winners of the accountancy awards 2008 at Birmingham City University (Photo credit: Birmingham City University)
Financial Accounting Vs Cost Accounting
1) It involves the preparation of a set of final accounts for each accounting period in accordance with the accounting standards and company legislation. It gives the overall financial picture of a company. 1) It is an internal management tool which provides appropriate timely information of management to help them for taking better decisions by applying the techniques viz; standard costing, budgetary control, marginal costing.
2) It can not provide information for future period 2) It can forecast for future period by the techniques of budgeting.
3) It can not provide information for day to day decision making . 3) It can provide day to day decision by applying the concepts of marginal costing , budgetary control etc.
4) It can not provide information to assess the performance of various persons of the department to see that cost don not exceed the reasonable limit for a given quantum of work. 4) The techniques of budgeting and standard costing enable the management to perform the function.

Besides above, the following distinction between financial and cost accounting has been discussed –
i) Purpose-
To provide investors, creditor or other external parties with useful information about the financial position, financial performance and cash flow prospect of an enterprise.
i) To provide the manager with information useful for planning, evaluation and rewarding performance and sharing with other outside parties and to apportion decision making authority over the firm resources.
ii) Types of report-
Primarily financial statements (profit & loss a/c and balance sheet and cash flow statement and related notes) provides investors, creditors and other users of information to support external decision making process.
ii) Many different types of report depending on the nature of business and the specific information needs of the management. Example; Budget financial projection, bench mark studies, activity based cost report and cost of quality assessment.
iii) Standards for presentation -
It follows generally accepted accounting principles including those formally established in the authoritative accounting literature and standard industry practice.
iii) rules are set within the organization to produce information relevant to the needs of management.
i) Time Periods-
Usually a year, quarter or month. Most report focus on completed periods. Emphasis is pl aced on the current period with prior periods often shown for comparison.
v) Any period- year, quarter , month,week,day even a work shift .Some reports are historical in nature. Other focus on estimates and results expected in the future period.
ii) User of information-
Outsiders as well as managers . These outsiders includes shareholders, creditors, prospective investors, regulatory authorities and the general public.
vi) Management (Different reports to different managers), customers, auditors, suppliers and others involved in an organization value chain.


Monday, February 06, 2012

Reconciliation between the financial and Cost Accounts

1.1 Where accounts are maintained on the integral system, there are no separate cost accounts and financial accounts. Hence, the question of reconciliation of cost and financial accounts does not arise. However, where separate sets of books are maintained for cost accounting and financial accounting system, it is imperative that periodically the two accounts are reconciled. A memorandum of reconciliation is prepared, indicating the reasons for difference between the results disclosed by each system.

1.2. The difference between the two sets of accounts arises because of the following reasons-

a) Items includes only in financial accounts-

There are number of items which appear only in financial accounts, and not in cost accounts, since they do not relate to the manufacturing activities, such as,

i) Purely financial charges, reducing profit

- Losses on Capital assets.

- Stamp duty & expense son issue and transfer of stock , shares and bonds.

- Loss on debentures.

- Discount on debentures, bond.

- Fines & penalties.

- Interest on bank loans.

ii) Purely financial income, increasing financial profit

- Rent received.

- Profit on sale of assets.

- Share transfer fee

- Share premium.

- Interest on investment, bank deposits.

- Dividend received.

iii) Appropriation of Profit- Donations and charities.

b) Items included only in cost accounts-

There are very few items, which appears in cost accounts, but not in financial accounts. Because, all expenditure incurred, whether for cash or credit, passes through the financial accounts, and only relevant expenses are incorporated in cost accounts. Hence, only items which can appear in cost accounts but not in financial accounts is a notional charge., such as, I) interest on capital which is not paid but included in cost accounts to show the notional cost of employing capital,

Or II) Rent i.e. charging a notional rent of premises owned.

c) Items included for differently in cost and financial accounting –

i) Overheads- in cost accounts, overheads are applied to cost units at predetermined rates based on estimates, and the amount recovered may differ from actual expenses incurred. If such under-or –over recovery of overheads are not charged off to costing profit & loss a/c, the profits on two sets of books will differ.

ii) Stock Valuation – in financial accounts, stock is valued at lower of cost or market value. In cost accounts, stock is valued at cost adopting one of her methods such as FIFO, LIFO, average etc, which is suitable to the unit. Thus, there may be difference in stock valuation which will reflect difference in profit between the two sets of books.

iii) Depreciation- if different basis is adopted for charging depreciation in cost accounts as compared to financial accounts, the profits will vary.

Sunday, February 05, 2012

Classification of Cost

Cost Classification refers to the process of grouping costs according to their common characteristics such as nature of expenses, function, variability, controllability and normality. Cost Classification can be done on the basis of time, their relation with the product and accounting period. Cost classification is also made for planning and control and decision making. Thus classification is essential for identifying costs with cost centers or cost units for the purpose of determination and control of cost.

A) Nature of expenses – Costs can be classified in to material labour and expenses.

B) By function-

- Production cost – It begins with the process of supplying material labour and services and ends with primary packing of the finished product.

- Administration cost is the aggregate of the costs of formulating the policy , directing the organization and controlling the operation of an undertaking, which is not related directly to production, selling, distribution, research and development activity or function.

- Selling costs refers to the expenditure incurred in promoting sales and retaining customers.

- Distribution costs begins with the process of making the packed product available for dispatch and ends with making the reconditioned empty package available for use.

- Research & development cost relates to the costs of researching for new or improved products, new application of materials or new or improved methods, processes, and cost of implementation of the decision including the commencement of commercial production of that product or by that process or method.

- Preproduction cost refers to the part of development cost incurred in making trial production run preliminary to formal production, either in a new or running factory , this cost then represents research and development costs also. Pre-production costs are normally considered as deferred expenditure and are charged to the cost of future production.

C) By Variability –

Costs are classified in ti fixed, variable and semi fixed/ semi-variable costs according to their tendency to vary with the volume of output.

- Fixed Cost- It tends to remain unaffected by the variation or changes in the volume of output, such as supervisory salary, rent, taxes, etc.

- Variable costs- It tends to vary directly with volume of output, such as direct material, direct labour and direct expenses.

- Semi-fixed/semi—variable cost – it is partly fixed and partly variable, such as telephone expenses, electricity charges, etc.

D) By Controllability-

Costs can be classified under controllable and uncontrollable cost.

- Controllable cost can be influenced by the action of a specified member of an undertaking.

- Uncontrollable costs can not be influenced by the action of a specified member of an undertaking.

E) By Normality- Costs can be divided in to normal and abnormal cost.

- Normal costs refers to the cost, at given level of output in the conditions in which that level of output is normally attained.

- Abnormal cost is a cost which is not normally incurred at a given of output in the conditions in which that level of output is normally attained.

F) On the basis of time - Costs can be classified in to historical or actual costs and predetermined or future cost.

- Historical cost- It relates to the usual method of determining actual cost of operation based on actual expenses incurred during the period. Such evaluation of costs takes longer time, till the accounts are closed and finalized, and figures are already for use in cost calculations.

- Predetermined cost- It is prepared in advance before the actual operation starts on the basis of specializations and historical cost data of the earlier period and all factors effecting cost. Predet3ermined cost is therefore future cost and may be either estimated or standard.

- Estimated cost is prepared before accepting an order for submitting price quotation. It is also used for comparing actual performance.

- Standard cost is scientifically predetermined cost of a product or service applicable during a specific period of immediate future under current or anticipated operating conditions. The method consists of setting standards for each elements of cost, evaluating the variance from standard cost and finding reasons for such variance, so that remedial steps can be taken promptly to check inefficient performance.

G) In relation to Product – Costs may be classified in to direct and indirect costs.

- Direct costs are those, which are incurred for a particular cost unit and can be conveniently linked with that cost unit. Direct costs are termed as product cost.

- Indirect costs are those which are incurred for a number of cost units and also include cost which through incurred for a particular cost unit are not linked with the cost unit. Since such costs are incurred over period and the benefit is mostly derived within the same period, they are called period costs.

H) Cost analysis for decision making- Costa are classified under relevant costs (eg. Marginal cost, additional fixed cost , incremental costs, opportunity cost and irrelevant cost( e.g. Sunk cost, committed costs, etc)

Saturday, February 04, 2012

Cost Accounting

In earlier concept, costing was defined as the technique and process of ascertaining costs of a given thing. In sixties, the definition of cost accounting was modified as the “ application of costing and cost accounting principles, methods and techniques to the science, art and practice of cost control and ascertainment of profitability of goods or services.” It includes the presentation of information derived there from for the purposes of managerial decision making. It clearly emphasizes the importance of cost accountancy achieved during the period by using cost concepts in ore and more areas and helping management to arrive at good business decisions. To day the scope of cost accounting has enlarged to such an extent that it now refers to the collection and providing all sorts of information that assists the executives in fulfilling the organization goals. Modern cost accounting is being termed as management accounting, since managers being the primary user of accounting information are increasingly using the data provided by the accounts, setting objectives and controlling the operation of the business.

Cost accounting deals with the ascertainment of the cost of product or service. It is a tool of management that provides detailed records and reports on the costs and expenses associated with the operations, mainly for internal control and decision making. Cost accounting basically relates to utilization of resources, such as material , labour, machines,etc and provides information like product cost, process cost, service or utility cost, inventory value etc, so as to enable the management taking important decisions like fixing price, choosing products, preparing quotations, releasing or withholding inventory etc.

OBJECTIVE – The objective of cost accounting is to provide information to internal managers for better planning and control of operations and taking timely decisions. In the early stages, cost accounting was considered as an extension of financial accounting. Cost records were maintained separately. Cost information and data aware collected from financial books, since all monetary transactions are entered in the financial books only. After developing product cost or service cost and valuation of inventory , the costing profit and loss account is prepared. The profit and loss figures so derived by the two sets of books i.e. financial accounts and cost accounts would have to be reconciled, since some of the income and expenditure recorded in financial books do not enter into product cost, while some of the expenses are included in cost accounts on notional basis i.e. without having incurred actual expenses. However a system of integrated accounts has been developed subsequently wherein cost and financial accounts are integrated and one set of books can be maintained.

Friday, February 03, 2012

Management accounting by definition

Definition – (By Institute of Cost and Works Accountants of India) Management accounting is defined as a system of collection and presentation of relevant economic information relating to an enterprise for planning, controlling and decision making.

(By Institute of Chartered Accountants of India)-Such of its techniques and procedures by which accounting mainly seeks to aid the management collectively have come to be known as management accounting.

(By International Federation of Accountants)- Management Accounting is the process of:

Identification and Measurement – The recognition and valuation of business transactions or their economic events that have occurred or may occur;

Accumulation- The discipline and consistent approach to recording and classifying appropriate business transactions and other economic events;

Analysis – The determination of reasons for and the relationship of the reported activity with other economic events and circum stances;

Preparation and interpretation – The meaningful coordination of accounting and/ or planning data to satisfy needed for information presented in logical format and if appropriate, include the conclusion drawn from the data;

Thursday, February 02, 2012

Management Accounting

Management Accounting – Concept, Need, Importance, and Scope, Cost Accounting: Classification of cost, Reconciliation of profit between financial and cost Accounting. Difference between Financial Accounting and cost Accounting.

Introduction – Cost accounting no doubt serves the internal management by directing their attention on inefficient operations and assisting in a day-to-day control of activities of the enterprise. But even costing information fails to meet informational needs for management functions. The costing data needs to be arranged, re-analyzed and processed further for playing more effective role in the managerial process. In addition to costing and accounting data, managerial functions need the use of socio-economic and statistical data( eg; population break up, income structures etc). These information’s are beyond the scope of cost accounting and financial accounting which pave the way for emergence of management accounting. Management accounting provides all possible information required for managerial purposes.

Management Accounting is comprised of two words ‘Management ‘ and ‘Accounting’ . it is the study of managerial aspect of accounting. The emphasis of management accounting is to redesign accounting in such a way that it is helpful to the management in formation of policy, control of execution and appreciation of effectiveness. It is that system of accounting which helps management in carrying out its function more effectively.

The term management accounting is of recent origin. This term was first used in 1950 by a team of accountants visiting USA under the banner of Anglo- American council on Productivity. The terminology of cost accountancy had no reference to the word management accountancy before the report of this study group. The complexities of business environment have necessitated the use of management accounting for planning, co-coordinating and controlling functions of management.

A small undertaking with a local character is generally \managed by him. The owner is in touch with day-to-day working of the enterprise and he plans and coordinate the activities himself. The use of simple accounting enables the preparation of profit & loss account and balance sheet for determining profitability and assessing financial position of the enterprise. All information needs for management purposes are met by simple financial statements. Since the owner is both the decisions- maker and implementer of such decisions, he does not feel the necessity of any communication system and no additional information is required for managerial purposes. The evolution of joint stock company form of organization has resulted in large-scale production and separation of ownership and management.

Wednesday, February 01, 2012

Is depreciation a source of funds

Depreciation means decrease in the value of an asset due to wear and tear, lapse of time, obsolescence, exhaustion and accident. Depreciation is taken as an operating expenses while calculating funds from operation. The accounting entries are as follows-

i) Depreciation A/C Dr

To Fixed Assets A/C

ii) Profit & Loss A/C Dr

To Depreciation A/C

Both the profit & loss A/C and depreciation are non-current asset and depreciation is an non fund item. It is neither a source nor an application of funds. It is added back to the operating profits to find out funds from operation since it has all been charged to profit & loss a/c bur it does not decrease fund from operations. Depreciation should not therefore be taken as source of funds. If depreciation were really a source of fund by itself then any enterprise would have improved its position at will by merely increase the periodical depreciation charge.

Fund flow statement Vs Income statement

1) It deals with financial resources required for running the business activities. It explains how were they used.

1) It discloses the results of the business activities i.e. how much has been earned and how it has been spent.

2) It matches the fund raised and fund applied during a particular period. The sources and applications of fund may be of capital as well as revenue nature.

2) It matches the income of a period with the expenditure of that period which are both of a revenue nature. For examples when shares are issued for cash, it becomes a sources of fund while preparing a fund flow statement but it is not an item of income for an income statement.

3) Sources of fund are many besides opearations such as shares capital , debentures, sale of fixed assets.

3) It discloses the results of operations can not even accurately tell about the funds from operations alone because of non-funds items (such as depreciation, writing off fictitious assets etc being included there in.

Fund flow statement Vs Balance Sheet

1).It depicts the overall increase or decrease in working capital during a particular period.

1) shows the financial position of a business on a particular date

2) It incorporates the different sources and applications of funds during a period.

2) It incorporates all assets and liabilities on a particular date .

3) It depicts the changes that have taken place in the fixed assets and fixed liabilities, which have a bearing on the funds during a particular period.

It shows all assets and liabilities of a business on a particular date.

4) It is a dynamic statement since it focuses on those major transactions, which have been behind the balance sheet changes.

4) It is merely a statement of assets and liabilities on a particular date.

Tuesday, January 31, 2012

Preparation of fund flow statement

However, the technique of cash flow statement when used in conjunction with ratio analysis serves as barometer in measuring the profitability and financial position of the business.

 

Preparation of fund flow statement

The preparation of fund flow statement has the following steps-

A) Schedule of changes in working capital-

B) FUND flow Statement

A) Schedule of hanges in Working Capital-

It can be prepared by comparing the current assets and current liability of two periods.

Items

As On

As On

Change

CURRENT ASSETS

Cash Balance

Bank Balance

Marketable securities

Accounts receivables

Accounts receivables

Stock-in-trades

Prepaid expenses

CURRENT LIABILTY

Bank overdraft

Outstanding expenses

Account payable

Increase
Decrease
Net increase/ decrease in Working Capital

Rules for preparing the schedule-

i) An increase in current assets results in increase in working cpital.

ii) Decrease in current assets result in decrease in working capital

iii) Increase in a current liability results in decrease of working capital.

iv) Decrease in a current liabilities results in increase in working capital.

B) FUND FLOW STATEMENT

Source of Funds:

Issue of shares

Issue of debenture

Long term borrowing

Sale of fixed assets

Operating profits

Total sources

Application of Funds-

Redemption of redeemable preference shares

Redemption of debentures

Payment of other long term loans

Purchase of Fixed Assets

Operating Loss

Payment of Dividends, Tax etc

Total uses

 

Net increase/ Decrease in working capital

( Total Sources – Total Uses)

 

Monday, January 30, 2012

Ancient therapies

Ayruveda:

Ayruveda is an important discipline of Indian medicine. It has a 5000-year-old history. It is fully recognized by the World Health Organization. Ayur is in Sanskrit means life, it is known as “science of life”. It is a mixture of physical, social, moral, mental welfare. Ayruveda proceeds with individualistic approach. Ayurvedic theory diagnonises patient constitution and learn how a disease might manifest itself depending on the body structure. It not only recommends medicine but also recommends each person’s lifestyle, dietary habits, exercise, drug therapy, condition of digestion, pachakarma and Yoga practices to restore balance in the body and mind. It derives and connects body and soul. Ayruveda connects science to ancient medicines.

Unani:

Unani system of medicine has its roots in Greek philosophy. Our body is composed of four basic elements: earth, air, water and fire. All four elements have different sub sections and heat. All four elements are merging and output is four different temperatures: hot wet, hot dry, cold wet and cold dry. The treatment here comprises of three components: preventive, promotive, curative. For the balanced health the six essentials written above are the need of the hour: Atmospheric air, drinks and food, sleep and weaknesses, excreation and retention, physical activity and rest, mental activity and rest. The diagnosis processed with the help of pulse examination of urine and stool.

7

Yoga:

It is a drugless therapy. It is popular all over the world. With the advancement of the modern technology our lives are now too fast paced: Computer, internet, cell phone, television. Heavy work, tight schedule, demanding work conditions is slowly making us more and more stressful. Yoga helps to retrieve mind and rejuvenate ours bodies. With Yoga we stay at the present, living with the present and in this way we releases stress. Yoga helps us to relax and learn various types of pranayama. Yoga helps you to become more aware of your body posture, alignment and breath. Yoga invigorates the internal organs, reduces fat and stimulates the nervous system. 21-year old girl posting mainly about fashion, but also about my life, sex, boyfriend, pet chinchillas and more.Hollow-Star.net

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Saturday, January 28, 2012

New Pimp My Cube Contest has a total grand prize value of approximately $1200

This post brought to you by Contest Factory. All opinions are 100% mine.

The contest period is from 12/5/11 at 12:00PM to 1/31/12 at 12:00PM. Hurry up mates.

Since I am a blogger for the last four years and has been writing the blogs and going to office simultaneously. So, I have two cubicles one is here at my home nearer to my PC and the other is at my office. Due to continuous work pressure and time frame to finish the pending job I always have to do face stiff work schedule to make it order but sadly at the finish time all the arrangements got weird and giving the entire cubicle both here and at my office  becomes soiled ,filthy and dirty. Even my friends and colleagues complain about the same unclean environments they are working with due to heavy work load and constant job pressure. Sometimes I looked around to get the sense of the work place environment as the research scientist but feels that no where am finding any thing that can be considered as clean. Many a times it is in such a horrible condition that when sometimes the power goes out I feel something like the ghost environment in my hidden senses.

New Pimp My Cube Contest has a total grand prize value of approximately $1200

Do you feel the same way in yours professional life work conditions? You can revive yours inner statesmanship by bringing back yours dirty boxy cubicle workplaces by capturing all these horrible true pictures of yours work environment where you are spendingng half of yours times of the day. If you are one of those guys then Pimp My Cube Contest has got you a whole New Pimp My Cube Contest which has a total grand prize value of approximately $1200. Contest Factory wants you to submit a video showcasing your cubicle catastrophe; from the outdated computer to the carpet coffee stain. They want your video to encompass everything that makes your cube awful, exceptional bad or displeasing. Pimp My Cube Contest is searching for the worst office environment which includes messy workplace, awful computers, dirty furniture, awful hangers and windows sheets , unorganized dark places which almost makes you not to work there on. Upload the video, ask for yours family, friends online and  offline  and co workers to vote for yours video. Encourage yours friends and family vote on yours video to enhance your chances of winning. You get sweepstakes entry points for registering, voting, commenting and inviting others to register for the contest. Enter and vote for the most pathetic cubicle (or office) in Contest Factory's Pimp My Cube Contest contest!

Entering the contest:

Please register Pimp My Cube Contest to cruise the site, vote on videos or enter your own video. Pimp My Cube Contest is looking for the most pathetic and miserable cubicle or office space . Upload your video explaining why your workspace is so miserable, get your friends & associates to vote for you and you may just win the grand prize! You may also win a $200 gift card just for registering which automatically enters you into the sweepstakes! Have fun and remember .

 

The contest Pimp My Cube Contest commences and it is nice to join now so that you can have greater chance of winning these grand prizes.

 

How to register for this grand prize:

Go to http://www.contestfactory.com/pmc (Pimp My Cube Contest) Register into the site. Complete the registration form on the register page. You can register via Facebook connect or you can register directly to the site. You will be asked to select a username, password and your e-mail address, You also need to complete your profile with: first, last name, country, state, gender, age group, how heard, company website, company size, phone#, job title/role. (Note: Entrants are solely responsible and liable for all actions taken under their username or password so you should maintain it as secure.) If registering directly to the site, after filling out the registration form, click on REGISTER button. Within a few minutes Entrants will receive an automatic e-mail from the site to authenticate and confirm their registration. Follow the instructions inside the e-mail to activate your account. After account activation, an Entrant is directed to the site. o enter the contest you must be working for a company that has office space or cubicles for its employees. You will need to complete information about your company in your profile page. This includes Company Website, Company Size, Daytime Phone and Job Title/Role. You will also be given an option to request a demo of Contest Factory’s solutions.

Please check this demo

One  in AVI, MOV, MPEG or WMV format with a minimum duration of thirty (30) seconds and maximum duration of sixty (60) seconds no larger than 100MB.Entry Name. A brief description of entry (optional). Contestants are allowed to submit an unlimited number of original Entries, but duplicate entries will be excluded. If the Contestant’s company profile page is incomplete, the Contestant will be required to complete all fields on his/her profile page, e.g. Company Website, Company Size, Daytime Phone and Job Title/Role.

 

Conclusion:

You get sweepstakes entry points for registering, voting, commenting and inviting others to register for the contest (Pimp My Cube Contest). The grand prize of your cube being ‘pimped’ will be selected by CF judges based on various criteria including for the most votes, best (really worst) video and most compelling story. At the conclusion of the Contest period, one winner will be selected and declared by the Pimp My Cube Contest Contest judges (“Judges”). The Judges will be selected by Contest Factory and may include employees, officers, directors, managers and agents of such entities. Judges will evaluate all videos on the following objective judging criteria: Pathetic Cubicle/Office Space (in the video), Most Deserving Explanation (in the video) and number of votes. The contest has a total grand prize value of approximately $1200. Prize is to update your office/workspace/cube with one of three prize packages:

Prizes:

Technology Package: new computer system with LCD monitors stereo speakers and web cam.

Furniture Package: new desk, ergonomic chair, painting or artwork and plants.

Entertainment Package: New sound system, Espresso Machine, Mini-fridge and Personal Water dispenser, etc.

For list of results, send a hand-printed, self-addressed, stamped envelope to Pimp My Cube Winners List, c/o Contest Factory, 8502 E. Chapman Avenue, No. 334, Orange, CA 92869.

16.1 Contest Factory, 8502 E. Chapman Avenue, No. 334, Orange, CA 92869

 

Right now upload the so the chances of winning are very good. There is no contest entry fee (Pimp My Cube Contest) for this. It is easy to upload to the site to enter from your phone or webcam. So what are you waiting for? Join now and upload your dirty office video and encourage yours friends, colleagues and relatives to upload the dirty cubicles of their respective places so that yours chances of winning this grand prize becomes more and more imminent.

Register now Pimp My Cube Contest Take pictures, of yours dirty office spaces showing yours miserable work conditions. Enter into

 

 

 

Visit Sponsor's Site

Friday, January 27, 2012

Weird problems

Domestic help is important for every house hold those who can afford to pay for it. They clean the house, wash the clothes, and do the daily cleansing and previous pending works. Most of the house holds depends upon them for their daily work. In Puri in most of the houses domestic help used to do various home works like that of cleansing of utilities, For the last two years their wages now been on the rise and it is on the higher side in each year sometimes they increase the wages in the month of October and sometimes they increase the wages in the month of January in the new year. Now days the number of domestic helps in the decline due to some positive government policies. There lots of money to earn from various positive government policies and for this now the trend is changing. They are now getting more than two hundred days of earning opportunities apart from other earning from various government welfare measures. This adds to the problem for various house holds. Due to the scarcity of domestic helps , there salary is on the rise and they are also now more ad more demanding and also their work standards is on the decline. They are now working at more than sixteen houses and this is obvious as how could they manage the house holds by going to various far and wide places of Puri town and the standard of work I on the decline. Every homes priority is for cleaning and for all the essential works is done by the domestic help but with increase in time the duration of the work is on the decline and the standard of the work is one the decline.

Sometimes there behaviors are also rude and if you say some rude words or some mild rude words they will complain about everything. Now it seems that this being the most worrying factor. How to get rid of it? As the more you increase the wages of the domestic help they tend to reduce the work loads and try to finish the work in a hurry. The house holds works seems to be a difficult task and how it is to be solved and how easily it can be done and finished. What should be the problem no one can solve it? As the government can not solve it as it is doing the welfare works and that too it is also extending to richer people through Adhar cards and other welfare measures. Now the next problem I to find the persons who plucks the coconut from trees. Now the new generation of coconut pucker s has been evading from their earlier possessions. Now their new generations not doing these coconut plucking professions and for this there is strenuous lack of these coconut pluckers. Now their fathers has been doing this profession and for this serious lack of coconut pluckers and all the house holds having the coconut trees is feeling the brunt of it.

Weired problems

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Related posts:

This is what Puri is known for





Puri is the religious capital of Odisha and a renowned place of Bharat. There are times when a healthy category of population knows Odisha only through Puri. The population of Puri town is not big but the floating population Puri is always high. There are lots of tourist’s flows, here from every nuke and corner of Bharat and the world.

One American couple in the mid thirties, few days back boarded at Puri. They were walking by the side of road nearer to the sea at the northern side of Puri. Suddenly, there appeared two to three visitors from the ... (Read more at source)
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Thursday, January 26, 2012

Happy Republic day

Happy 63rd republic day of India. The entire Indian Ocean around the globe is rejoicing to the tune of glorification of India’s Republic day. The tune and symphony of Republic day is a proud moment for all Indians living in India and around the globe. People first and the mission to protect India is always the motto of Air India. A few days ago Indian Air force women were officers landing air craft at Mt. Everest. This is the new beginning for modern Air Force of India. With the advancement of technology India is marching ahead. The Prime Minister of Thailand is the chief guest of India’s sixty third Republic Day. The long range and the high accuracy of Indian Air force is keeping us safe from envious enemies. Ours Jawans keep constant vigil on ours borders among various difficult situations. This has been done with the holistic approach to techniques and growth. Border Security Force’s tune “Vijay Bharat” has been exceptional. The naval contingent is the sign of brevity and might. Al these security forces are committed to garner the quality of life for all citizens of India. Drums, symbols, trumpets are sounding the glory of India. They ensure that ours independent always remains and we live in a safe and happy society. India has the largest unified society as a core. Assam Rifles' song “Desh ki hamen shan badhai ” has been exceptional. Twenty lakh square kilometers are protected by Indian coast guard. Let the history record us instead as a generation that made a great progress in the golden writings of the world. They are saving ours borders from Kashmir to Kanyakumari and from Rajasthan to Arunnachal Pradesh. They are singing the song Saren Jahan Se Achha Hindustan Hamara . They march in unity, they show the brevity , they attain the success ,they save the land as they stay awake in the scorching cold of minus forty degrees and they save ours borders from tiring summer of above forty five degrees. India is not merely as the world’s biggest democracy, it is the youngest nation state and becoming younger day by day. Normally, the two thirds of the population would be in the fifteen to fifty nine working age group over the next decade.

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This blog chronicles the journey of the 2007 Britain's Got Talent winner, Paul Potts. The ultimate purpose of RoadTurn.com is to encourage readers and to make the case that the Paul Potts story is not only about him...all of us can realize our dreams and live the life we have imagined...RoadTurn.com

Related posts:

The unnoticed





The unnoticed is a peculiar name to start with but it is true , it some what not comprehending tom find it out. Puri is a religious place worth for and renewed for through out the world. Shimmering and dynamic continuous tourists and also a better place to live in for and worth for. There are lots of beautiful places of Puri and lots of ugly places. The Lord Jagannath temple, the beauty full sea and also the Puri Hospital a beautiful government hospital worth to look at it. It is ISO certified and the cleanliness and the procedure has ... (Read more at source)
The new year at Puri





The fantastic new year in the prospect with beautiful climate ushering with coolness decreasing slightly and slow drizzle in between. The people all around India flocking into Puri to see the glimpse of ours Lord of the Universe. The Jagannath and his elder brother and little sister. The number of people seems unbelievable high. There is no inch of land left where the people have not occupied. The flooding of population can be a challenge for the administrator and the administrator has done their duty fully accomplished with flying colors. The entire Puri town is lighted and the streets lights ... (Read more at source)
This is what Puri is known for





Puri is the religious capital of Odisha and a renowned place of Bharat. There are times when a healthy category of population knows Odisha only through Puri. The population of Puri town is not big but the floating population Puri is always high. There are lots of tourist’s flows, here from every nuke and corner of Bharat and the world.

One American couple in the mid thirties, few days back boarded at Puri. They were walking by the side of road nearer to the sea at the northern side of Puri. Suddenly, there appeared two to three visitors from the ... (Read more at source)
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Wednesday, January 25, 2012

An approach to Precis – writing

Précis-writing for the daily to summaries effectively. The summery ought to be precise, concise and authentic. Without sacrificing essential points, it should be expressed in few words. A précis should be one –third the length of the original password,

1. First read the original passage with concentration,

2. Try to minimize the informational explosion in the given passage,

3. The précis must be written in yours own words,

4. It must be coherent, continuous whole, preferably in single paragraph,

5. It must make complete sense,

6. It must be simple, cogent and grammatical,

7. Do not follow the order of the original sentence. Rearrange the entire sentence structure, try to be more logical,

8. As far as possible use indirect speech,

9. Revise twice, check for mistakes,

10. Write your fair copy only after you have satisfied yourself that you cannot improve if further,

11. Exercise yours privilege to censor the passage,

12. Leaves out all elaboration, repetitions and illustrations and persist to only bare essentials while writing précis,

13. Make a set of notes and a rough draft,

14. Find a suitable total for paragraph,

15. Read the passage a number of times,

16. Try to find the theme of the passage,

17. The heading of the passage may be a word phrase or a short sentence, signifying the main idea of the passage,

18. Précis writing demands extensive brain-work, invading attentive reading concentrated thoughts.

19. Write should be true to original but of a much reduced length,

20. Compressed the paragraph, without any distortion of the facts,

21. Understand the paragraph and rewrite briefly what has been read,

22. Employ both the skills of comprehension and composition,

23. Do not omit important points,

24. Check the word limit, compare with the original.

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Tuesday, January 24, 2012

Invitation to Triond from MOHAN MANOHAR MEKAP

Hi,

Triond is an online community of writers that I use to publish my writing, increase my readership, gain recognition and generate revenue. I wanted to let you know about Triond and invite you to join as well.

Signing up is a simple process and you can publish articles on nearly any subject. The best part is being paid for the revenue that your articles generate!

Simply follow this link and sign up.

Hope to see you on Triond!
MOHAN MANOHAR MEKAP

Weird problems

Domestic help is important for every house hold those who can afford to pay for it. They clean the house, wash the clothes, and do the daily cleansing and previous pending works. Most of the house holds depends upon them for their daily work. In Puri in most of the houses domestic help used to do various home works like that of cleansing of utilities, For the last two years their wages now been on the rise and it is on the higher side in each year sometimes they increase the wages in the month of October and sometimes they increase the wages in the month of January in the new year. Now days the number of domestic helps in the decline due to some positive government policies. There lots of money to earn from various positive government policies and for this now the trend is changing. They are now getting more than two hundred days of earning opportunities apart from other earning from various government welfare measures. This adds to the problem for various house holds. Due to the scarcity of domestic helps , there salary is on the rise and they are also now more ad more demanding and also their work standards is on the decline. They are now working at more than sixteen houses and this is obvious as how could they manage the house holds by going to various far and wide places of Puri town and the standard of work I on the decline. Every homes priority is for cleaning and for all the essential works is done by the domestic help but with increase in time the duration of the work is on the decline and the standard of the work is one the decline.

Sometimes there behaviors are also rude and if you say some rude words or some mild rude words they will complain about everything. Now it seems that this being the most worrying factor. How to get rid of it? As the more you increase the wages of the domestic help they tend to reduce the work loads and try to finish the work in a hurry. The house holds works seems to be a difficult task and how it is to be solved and how easily it can be done and finished. What should be the problem no one can solve it? As the government can not solve it as it is doing the welfare works and that too it is also extending to richer people through Adhar cards and other welfare measures. Now the next problem I to find the persons who plucks the coconut from trees. Now the new generation of coconut pucker s has been evading from their earlier possessions. Now their new generations not doing these coconut plucking professions and for this there is strenuous lack of these coconut pluckers. Now their fathers has been doing this profession and for this serious lack of coconut pluckers and all the house holds having the coconut trees is feeling the brunt of it. (by mummy)

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Monday, January 23, 2012

Proliferation of English language

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The development of English as a single global life-style is the most significant factor. English is the trans-culture bridge and an agent of homogenization. English is getting prominent in world language, so the English speaking countries will dominate English in the universal language. English has the semi official language in some sixty countries. English is widespread globally; its usage is growing at an alarming rate. English is world’s most taught language. English is not replacing other languages, it is supplementing them. Language study is compulsory at Russia, most prefer English. In Norway, Sweden, Denmark; English is compulsory. Within Europe, Holland has the highest concentration of English proficiency outside Britain. Recently at Portugal, the demand for English classes has replaced the demand for French. There are 1,500 English language schools in Tokyo and over one hundred opens in each year. The travel and communications languages of international airwaves are English. Pilot and ATC speak English at all international airports. Maritime traffic uses flag and light signals, when they communicate verbally, they would find a common language which would preferably be English. English is also the language of satellite communications. Five of the largest broadcasters are CBS (Canadian Broadcasting Corporations), NBC, ABC and the BBC broadcasting in English.

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Sunday, January 22, 2012

Utility of Cash Flow Analysis

A cash flow statement is useful for short term planning. A business enterprise needs sufficient cash to meet its various obligation in the near future such as payment for purchase of fixed assets, payment of debts maturing in the near future, expenses of the business etc.

i) It helps in efficient cash management – Cash is the basis for all operations and hence a projected cash flow statement will enable the management to plan and coordinate the financial operations properly. The management can know from which source it will be derived, how much can be generated internally and how much could be obtained from outside.

ii) It helps in internal financial management-It provides information about funds which will available from operation. This will help the management inn determining policies regarding the internal financial management eg, Possibility of repayment of long term debt, dividend policies, planning replacement of plant & machinery etc.

iii) Discloses the movement of cash- The increase in or decrease of cash and the reasons therefore can be known. It discloses the reasons for low cash balance in spite of heavy operating profit or for heavy cash balance in spite of low profit.

iv) Discloses success or failure of cash planning – The extent of success or failure of cash planning can be known by comparing the projected cash flow statement with the actual cash flow statement and necessary remedial measures can be taken.

 

Limitation of Cash flow analysis –

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1) Cash flow statement can nor be equated with the income statement. An income statement takes in to account cash as well as non-cash items and therefore net cash flow does not necessary mean net income of the business.

2) The cash balance as disclosed by the cash flow statement may not represent the real liquid position of the business since it can be easily influenced by postponing purchase and other payment.

3) Cash flow statement can not replace the income statement or fund flow statement. Each of them has a separate function .

However, the technique of cash flow statement when used in conjunction with ratio analysis serves as barometer in measuring the profitability and financial position of the business.

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