Parts of a Profit and Loss Account, Part 1 The first and most important part of the levy an income

tax return is the online reporting of revenue. Companies need from year to year in terms of consistent, if record sales. For some companies, the date of commencement of sales is a major problem, especi ally if the final acceptance by the customer on performance tests or other condi tions that must be met depends on it. For example, in an advertising agency revi ew of revenue for a campaign that is prepared for his client? If the work is com pleted and sent to the client for approval? If the client approves it? For adver tisements in the media? Or, if the settlement is complete? These are questions t hat determine a company for reporting sales and must be consistent every year, a nd the timing of reporting should be included on the financial statements. The next line in the profit and loss account the cost of goods sold expense. The re are three methods of reporting on the cost of goods sold expense. One is call ed in, first out (FIFO) is initially a different "last in-last" (LIFO) and the l ast is the average cost method. Cost of goods sold Cost is a huge element in a p rofit and loss statement and how it can be reported, a significant impact on the bottom line reporting. Other items in the profit and loss statement include inventory write-downs. A bu siness should regularly review the inventory to determine any losses due to thef t, damage and deterioration and to apply the lower of cost or market (LCM) metho d. Bad loans are also an important component of income. Bad debts are owed to a business from customers who bought on credit (accounts), but is not payable. The timing, if doubtful accounts is reported critical. We report exhausted before o r after the collection of all the efforts?

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