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Accounting Questions (1 Viewer)

Korn

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I am a bit confused about a couple of things, if I could get some feedback asap it would be greatly appreciated!

What are Operating revenues? are they the same thing as sales revenues from the statement of financial performance OR are they the receipts in operating actities from the statement of cashflows?

What does COGS consist of exactly, I know that freight & the cost of the goods that have been sold but could this be clarified?

What are classified as academic references in Accounting?
 

Minai

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For your first part, I think it can be classified as both, but im not certain (its been awhile since Ive done cashflow statements)

COGS is exactly what it is - cost of goods sold, so its basically the value of the inventory you have sold. ie if you sold computers and each computer in your inventory is valued at $500, then the COGS if you then go on to sell it will be $500.

Academic references? Any accounting journal would be
 

Korn

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Minai said:
For your first part, I think it can be classified as both, but im not certain (its been awhile since Ive done cashflow statements)

COGS is exactly what it is - cost of goods sold, so its basically the value of the inventory you have sold. ie if you sold computers and each computer in your inventory is valued at $500, then the COGS if you then go on to sell it will be $500.

Academic references? Any accounting journal would be
Where would you find info on industry changes and current issues
 

Minai

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Current issues? the financial review is a good place to start.
 

Korn

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How do you workout variable costs?
Say for example u earn $10 in sales revenue, and have $9 in expenses, of which $4 is fixed costs, then $5 is variable.
But if you have to work out how much variable costs there are if you make $8 in revenue, how do you do it????
 

SashatheMan

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Korn said:
What does COGS consist of exactly, I know that freight & the cost of the goods that have been sold but could this be clarified?


COGS is just basically used for to make yuor inventory less, by the amount thats been sold.
 

SashatheMan

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Korn said:
How do you workout variable costs?
Say for example u earn $10 in sales revenue, and have $9 in expenses, of which $4 is fixed costs, then $5 is variable.
But if you have to work out how much variable costs there are if you make $8 in revenue, how do you do it????

well if u know yuor total costs and fixed costs.

you just say : total cost - fixed cost and it shoudl give u yuor variable.

are u told those two?
 

Korn

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SashatheMan said:
well if u know yuor total costs and fixed costs.

you just say : total cost - fixed cost and it shoudl give u yuor variable.

are u told those two?
Nah for the variences, we are only given sales revenue and fixed costs
 

jase_

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Korn said:
How do you workout variable costs?
Say for example u earn $10 in sales revenue, and have $9 in expenses, of which $4 is fixed costs, then $5 is variable.
But if you have to work out how much variable costs there are if you make $8 in revenue, how do you do it????
Is your 2nd question in relation to your first question? If so, just remember that fixed costs are fixed, no matter what the sales revenue or production level, so just think about that.
 

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All these questions can be answered quickly by looking at a textbook or if not through common sense.
 

Korn

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jasee said:
Is your 2nd question in relation to your first question? If so, just remember that fixed costs are fixed, no matter what the sales revenue or production level, so just think about that.
Yeah Ill write out the Question:
A company recorded sales Revenue of $10million in 2004. The company incurred expenses of $9 million. Fixed costs accounted for $4 million of these expenses.
(a) Prepare a table showing how much net profit company would earn on sales of $8million, $10 miilion (thats $1 million), and $12 million
(b) If company's total expenses were $9 million in 2004 & fixed costs accounted for $6 million of these expenses. The remaining costs vary in proportion to sales. Prepare a table showig how much net profit company would earn on $8, $10 & $12 million
 

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