Reserve
Reserves are retained portions of profits set aside for specific purposes, such as legal obligations, future investments, or contingencies. Common types include capital reserves and revenue reserves. Though part of retained earnings, reserves provide additional transparency in financial reporting and support the business’s financial stability.
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Reverse Entry
A reverse entry is made at the beginning of a new accounting period to cancel out an adjusting journal entry…
Revenue Recognition
Revenue recognition is the accounting principle that determines when income should be recorded. Under accrual accounting, revenue is recognised when…
Retained Earnings
Retained earnings represent the cumulative net profit a company keeps after distributing dividends to shareholfers. Reported under equity on the…
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