Opening stock refers to the value of unsold goods, raw materials, or inventory a business holds at the beginning of an accounting year. It is carried forward from the closing stock of the previous year and is essential in determining how much stock was available for sale in the current period. It helps calculate the … Read more
Direct expenses are costs that are directly involved in the production, manufacturing, or procurement of goods for resale. These are the essential expenses incurred to make goods ready for sale or bring purchased goods to the business premises. Without incurring these costs, the production or resale activity cannot be completed. They are recorded on the … Read more
Sales refer to the total value of goods or services sold by a business during a specific accounting period. It is the main source of income for most businesses and plays a crucial role in calculating gross profit. Sales can be made either in cash or on credit, depending on how the transaction is carried … Read more
Purchase refers to the total cost of goods or raw materials bought by a business during an accounting year, mainly for the purpose of resale or production. Purchases can be made in cash or on credit, and they are a core part of trading activities. The total purchase amount forms an essential component of the … Read more
Opening stock refers to the value of unsold goods, raw materials, or inventory a business holds at the beginning of an accounting year. It is carried forward from the closing stock of the previous year and is essential in determining how much stock was available for sale in the current period. It helps calculate the … Read more
Capital refers to the money or assets brought into the business by the owner to start or operate it. It represents the owner’s financial share or claim in the business and is treated as a liability from the business’s perspective, since the business is considered separate from its owner. Capital is essential for purchasing assets, … Read more