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Types and classifications of cost. The cost may be classified as follows: 1) Future cost versus historical cost: Future costs are the basis on which financial decisions are taken. although they are only projections of what may or may not happen in the future, they are more important as compared to the historical cost, which … Read more

Factors Affecting Investment in Receivables the Size of Eowing are some of the factors that directly or indirectly affect the size of the receivables: 1) Size of Credit Sales: The major factor affecting the size of the receivable is the volume of the credit sales. Receivables have a direct relation to the credit sales. As … Read more

Types of Risks Associated with Receivables. The risk related to receivables are: 1) Supplier Fraud Risk: The supplier fraud risk is the risk which the supplier may present the fake or duplicated pay order or invoice to the lender for financing. 2) Receivable Title Risk: The risk which the supplier has previously allocated or guarantee … Read more

Costs Associated with Inventory. Following are the four major costs associated with inventory: 1) Purchasing Cost: This is the normal cost of inventory. It includes the purchase price of the product bought from outside and the production costs in case of the goods are produced in-house. This inventory may be valued in a variety of … Read more