A company may be treated as unconsolidated even when a parent company owns 50% or more of its voting common stock.
This usually occurs when the parent is not in actual control of subsidiary, has temporary control of the subsidiary or if the parent company’s business operations are considerably different than that of the subsidiary.
Read more: http://www.investopedia.com/terms/u/Unconsolidated-Subsidiary.asp#ixzz1VVZcwxXr
Showing posts with label Financial Management. Show all posts
Showing posts with label Financial Management. Show all posts
An organisation, typically a merchant bank, that accepts or guarantees exchange bills (bills of exchange) and so finances trade deals and goods are being shipped. It accepts the bills by agreeing to pay it at a discounted rate at some point in the future.
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A law or legislation under the jurisdiction of a committee other than the House and Senate Committees on Appropriations that establishes or continues the operation of a federal program or agency, either indefinitely or for a specified period.
An authorization act may suggest a level of budget authority needed to fund the program or agency, which is then provided in a future appropriation act. However, for some programs, the authorization itself may provide the budget authority.
A law or legislation under the jurisdiction of the House and Senate Committees on Appropriations that provides authority for federal programs or agencies to incur obligations and make payments from the Treasury.
Each year, the Congress considers regular appropriation acts, which fund the operations of the federal government for the upcoming fiscal year. The Congress may also consider supplemental, deficiency, or continuing appropriation acts (joint resolutions that provide budget authority for a fiscal year until the regular appropriation for that year is enacted).
Budget authority provided in an appropriation act that is first available for obligation in a fiscal year after the year for which the appropriation was enacted. The amount of the advance appropriation is included in the budget totals for the year in which it will become available.
Read Full post!All income that is subject to taxation under the individual income tax after "above-the-line" deductions for such things as alimony payments and certain contributions to individual retirement accounts.
Personal exemptions and the standard or itemized deductions are subtracted from adjusted gross income (AGI) to determine taxable income.
In economics, a country's GDP is the total value of goods and services produced within a country in a year, not including its income from investments in other countries. GDP is an abbreviation for `gross domestic product'.
GDP is the standard measure of the size of the economy. It is the total production of goods and services within the country. The total value of a nation's output, income, or expenditure produced within a nation's physical borders. One of the main measures of economic activity.
A crisis is a situation in which something or someone is affected by one or more very serious problems. Crisis is an unstable situation of extreme danger or difficulty; "they went bankrupt during the economic crisis".
People use crisis management to refer to a management style that concentrates on solving the immediate problems occurring in a business rather than looking for long-term solutions.
Budget is sum of money allocated for a particular purpose. Its a summary of intended expenditures along with proposals for how to meet them for particular span of time.
The budget of an organization or country is its financial situation, considered as the difference between the money it receives and the money it spends. In other words its estimate of the income and expenditures for a future period of time, usually one year
budgeting - The activity of constructing a budget
Similar to cash discount allowed to debtors, the firm may have a chance to receive the cash discount from the creditors for prompt payment. Provision for discount on Creditors is calculated at a certain percentage on Sundry Creditors.
Provision for discount on creditors will be shown on the credit side of Profit and Loss account and on the liabilities side of the Balance sheet by way of deduction from Sundry creditors.
To motivate the debtors to make prompt payments, cash discount may be allowed to them. After providing provision for bad and doubtful debts, the remaining debtors are called as good debtors. They may pay their dues in time and avail themselves of the cash discount permissible. So a provision for discount on good debtors at a certain percentage may have to be created.
Provision for discount on debtors will be shown on the debit side of Profit and Loss account and on the asset side of the Balance sheet by way of deduction from Sundry debtors (after deducting bad debts written off and provision for bad and doubtful debts).
Every business suffers a percentage of bad debts over and above the debts definitely known as irrecoverable and written off as Bad (Bad debts written off). If Sundry debtors figure is to be shown correctly in the Balance sheet provision for bad and doubtful debts must be adjusted.
This Provision for bad and doubtful debts is generally provided at a certain percentage on Debtors, based on past experience. While preparing final accounts, the bad debts written off given in adjustment is first deducted from the Sundry debtors then on the balance amount (Sundry debtors – Bad debt written off) provision for bad and doubtful debts calculated.
Provision for bad and doubtful debts will be shown on the debit side of Profit and Loss Account and on the assets side of the Balance sheet by way of deduction from Sundry debtors (after Bad debts written off if any).
Debts which cannot be recovered are called bad debts. It is a loss for the business.
Bad debts will be shown on the debit side of Profit and Loss account and on the assets side of the Balance Sheet by way of deduction from sundry debtors.
Depreciation is the cut in the value of fixed assets due to its use or obsolescence. By and large depreciation is charged at some percentage on the value of fixed asset.
Depreciation will always materialized on the debit side of Profit and Loss(P&L) account and on the assets side of the Balance Sheet by way of deduction from the value of concerned asset.
Interest receivable on investments is an income for the business.
Accrued interest on investments (outstanding interest receivable) will always materialized on the credit side of the Profit and Loss(P&L) account by way of addition to the appropriate interest account and On the assets side of the balance sheet by way of addition to the investments account.
Loans are the accumulated amount which is materialized in liabilities side of Balance sheet, it is derived by summing up all the borrowings from banks, financial institutions and other outsiders.
If loan is taken, it is an liability of the proprietor to pay back it with an Interest, that interest is accounted as expenses for the business.
Interest on loan outstanding will always metalized on the debit side of the Profit and Loss account adding it to the apt interest account and on the liability side of the Balance sheet by adding it to the particular loan account.
Amount withdrawn from the business by the proprietor for his personal use is booked as drawings. Interest on drawings is treated as an income for the business and by the way it will reduce the capital of the owner. This is accounted like this in order to protect the capital in the business and to discourage drawings.
Interest on drawings will always be materialized on the credit side of Profit and Loss(P&L) account and on the liabilities side of the Balance Sheet by adding it to Drawings a/c which are eventually deducted from the capital.
In progress of assessing the profitability of the business it is required to charge interest on capital at a certain rate. It also on the way helps to benchmark the profit standard at par to prevailing rate of income in the market.
Interest on capital will always be materialize on the debit side of Profit and Loss(P&L) account and on the liabilities side of the Balance Sheet by adding it to the capital.
Income inward during a particular accounting period for the work or service to be done in future period is booked as income received in advance.
Incomes received in advance will always shown on the credit side of the Profit and Loss(P&L) account by subtracting the same from the respective income and on the liabilities side of the Balance sheet.
Income which is liable to be received but not received during the accounting period is booked as accrued income.
Accrued income will always be shown on the credit side of Profit and Loss(P&L) account by adding it to respective income and on the assets side of the Balance Sheet.
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