Factory overhead costs

Factory overhead is also named as manufacturing overhead. Factory overhead cost is the total operational cost used for production or manufacturing in a factory. It’s not the direct cost associated with raw material and labor. Its also called an indirect cost.

Factory overhead includes in manufacturing cost category.

Bank Reconciliation

Accounting software, Small business accounting software

Bank reconciliation is a process of comparing company’s own financial record with bank record to maintain the accurate figure.

Bank reconciliation is very necessary as it helps to avoid any overdraft payments, duplicate charges etc. Double entry bookkeeping is one way to perform reconciliation. Bank reconciliation needs to be prepared for every month. Bank reconciliation is a way of finding errors in bank account and company’s ledger account.

Endowment Fund

Endowment fund is always held by a non-profit organization as invested capital in this fund need to use for only non-profit works. In endowment fund the principal amount must be retained and earnings from this fund only can use for operational works.

This fund integrated with non-profit organizations like collage, universities, NGO, hospitals, church etc.

Liquidity Ratio

Liquidity ratio measures the ability of a company to pay its current and long term liabilities. It’s the easiest way to know how much fund a company can raise and how much asset can convert into cash?

Liquidity ratio can be categorized into various types such as: Acid ratio, Cash ratio & current ration. 

Acid Ratio:  Acid ratio also called as quick ratio. Acid ration defines the ability of a company to meet its current and short term obligations with the use of its most liquid assets.

Calculation method:   Cash & cash equivalents + Accounts receivable + Short term investments / Current liabilities