The line of credit is a kind of loan agreement between a bank or any financial institution and a customer. A customer can be an individual person, a business entity, non-financial institute, Government etc.
Incremental revenue is the additional revenue incurred from the selling of additional units. Incremental revenue occurs in the below-mentioned situation:
A holding gain is a gain of value that incurred after holding an asset. This gain happens over a period of time and the owner can sell it at any time in exchange for cash or other assets.
A flexible budget changes with production volume. For example, if the production increases then the budget will increase and vice versa.
FIFO stands for “First in First out”. FIFO is an asset & stock management and valuation method. This method is widely accepted by businesses.
Pharmacy stores mainly use this method to manage stock and to check which one needs to be ordered on urgent basis.
Capital expenditure is the total amount of money a business bears in buy and maintain fixed assets like building, furniture, machinery etc.
A debit note issued by a buyer to a seller at the time of returning purchased goods in credit. Debit note is a type of invoice whereas; it’s not a regular invoice.
A deferred expense is a cost that has been incurred but not yet consumed. This cost is termed as an asset until and unless underlying goods & services are consumed.
Demand deposit and term deposit are two different types of deposit accounts either in the bank or any financial institution.
Let’s find out the definition of Demand deposit …
The total amount of interest earned or paid in a year on any financial products, loans etc. is called as the effective annual interest rate. The effective annual interest rate is also known as an effective interest rate.
So, how to calculate effective interest rate? Here is the formula: r = (1+i/n) n -1
r= effective interest rate n = no. of periods i= annual interest rate
Effective annual interest rate calculates while considering compound rates instead of static interest rates.