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The material quantity variance can yield unusual results, since it is based on a standard unit quantity that may not be even close to actual usage. The material quantity is usually set by the engineering department, and is based on an expected amount of material that should theoretically be used in the production process, along…
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Crediting the Accounts Payable account increases the company’s liabilities, showing that the purchase will be paid for at a later date, not immediately impacting the company’s cash flow. If the purchase is on credit, credit the Accounts Payable account to increase the company’s liabilities, indicating that the company has an obligation to pay the supplier…
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Or you might compare current assets to current liabilities to make sure you’re able to meet upcoming payments. The balance sheet, income statement, and cash flow statement make up the three main financial statements that businesses use. Companies are required by law to generate these financial statements. With this in mind, she might aim to grow her easily…
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