Archives: Countly Learning
Payment Methods
Payment methods include cash, cards, digital platforms, and more that people use to send and receive money when they buy things. They offer ease, security, and freedom. What are Payment Methods? Individuals transfer money when they are paying for goods and services to the merchants or businesses and when they can pay the payment in […]
Direct Method of Cash flow statement
The Direct method of Cash flow statement? The direct cash flow approach uses actual cash inflows and outflows that are taken directly from business activities. This means that instead of employing the accrual accounting approach, cash is measured as it is received or paid. In accrual accounting, revenue is recorded as it is earned rather […]
The Indirect Method of Cash Flow Statement
Let’s get straight to the point: the indirect method is how most businesses prepare their cash flow statement. It’s practical, straightforward, and links the cash flow to the income statement. But why? Well, it’s simpler and way easier to handle than the direct method, especially when things get complicated. Instead of tracking every single cash […]
Cash Flow Ratios
Let’s get right to the point: you have to know your company’s cash flow. Profit and loss sheets show if you’re making money, but what about the cash coming in and going out? You could be making money with your business today if you don’t understand cash flow, but tomorrow you might have bills that […]
Free Cash Flow
Alright, here’s the deal. Businesses might be making good profits, but that doesn’t always mean they’re swimming in cash. The real question is: How much cash is actually available to the company after all the bills are paid and the important investments are made? That’s where free cash flow (FCF) comes in. Forget about accounting […]
Cash Flow vs. Profit: The Real Difference That Matters
The phrases profit and cash flow are often used in the financial industry. They are not the same, and confusing them can result in poor choices, particularly for business owners or those assessing the financial standing of an organization. So, what is Cash Flow? Cash flow is the actual flow of money in and money […]
Operating Cash Flow: The Core of Business Liquidity
Operating cash flows (OCF) are one of the most significant values any business can focus on when monitoring its financial performance. It is the net profit achieved from the direct business line, or the sums earned at the primary business of a business firm through sales of goods or services and the deductions made therefrom […]
Cash Flow from Investing Activities: What You Really Need to Know
Revenue generated by investments is a key component of a company’s financial statement. It displays the amount of money a firm uses or makes from the purchase and sale of assets like as machinery, real estate, and even investments in other companies. For students, investors, and business owners, knowing this cash flow is essential to […]
Cash Flow from Financing Activities: The Blueprint for a Company’s Financial Strategy
Not only a line item on a financial statement, cash flow from financing operations is an important indicator of how a business is managing its capital structure and finances. The firm indicates in this portion of the cash flow statement whether it is raising money through the issuance of debt or stock, the repayment of […]
Cash Flow Statement: Purpose and Structure Simplified
Cash flow statements are one of the crucial parts when we consider financial statements. Business needs this statement to track cash intake and expenditure. Unlike an income statement, which only shows profits and losses, or a balance sheet, which displays the assets and liabilities, the cash flow statement provides information regarding cash. Understanding this statement […]
What is Cash flow?
Money is always coming into and going out of a company. For instance, when a store buys goods, capital leaves the company and goes to the suppliers. Customers pay the store in full when they purchase an item from the store’s inventory. The company is moving money out of its coffers and toward its creditors […]
Understanding Bank Errors in Bank Reconciliation
Imagine you’re navigating a bustling marketplace of numbers, where every transaction tells a story. Yet, amidst the hustle, errors can sneak in, obscuring the true financial picture. Bank reconciliation is your compass in this chaotic environment, guiding you through discrepancies and ensuring every penny is accounted for. In this blog, we’ll uncover the common pitfalls […]
Treatment of Errors found in Cash Book
A cash book is one of the important tools for handling finance, and it acts as both a journal and a ledger. The cash book records all the cash transactions, which include payments and receipts. This helps the business with tracking the cash flow and also ensures accuracy in tasks of accounting and ease of […]
Adjusting Bank Statements in India: Why It Matters and How to Do It Right
Bank reconciliation isn’t just a boring accounting task—it’s one of the most critical things a business has to get right. In India, adjusting bank statements goes beyond balancing numbers; it’s about catching errors, managing cash flow, and ensuring compliance with tax laws. Ignoring this process? You’re basically inviting chaos into your finances. Let’s break down […]
Understanding Deposits in Transit and Their Role in Bank Reconciliation
The concept of deposit in transit is one of the important steps towards maintaining accuracy in record keeping. In this blog, we will discuss what the deposits in transit really are, their importance for bank reconciliation, errors related to them, and how businesses can manage them with the help of technology. What is a Deposit […]