Business

Basic Terminologies of Accounting for Hire Purchase System

Basic Terminologies of Accounting for Hire Purchase System

The hire-purchase system is a special system of purchase and sale of goods. It is a special system of purchase and sale of goods. Under this system, the purchaser pays the price of the goods in installments. The installments may be annual, six-monthly, quarterly, monthly fortnightly, etc. Basic T.....

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At Premium

At Premium

At Premium It means more value of shares and debentures i.e. higher value than the face value of shares or debentures. “At a premium” is a phrase attached to a variety of situations where a current value or transactional value of an asset is above its fundamental value. If you buy or .....

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Accounting Methods of Recording Hire Purchase Transactions

Accounting Methods of Recording Hire Purchase Transactions

Accounting Methods of Recording Hire Purchase Transactions Hire purchase is an agreement between two parties in which one party purchase any asset from other parties. Because he has no money to pay, so he pays per month hire charges. For the accounting point of view, both hire purchase and instal.....

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Antedated Check

Antedated Check

Antedated Check Antedated means the date entered on any legal contract which is earlier than the actual date of occurrence of contract. An antedate is a date entered on a legal contract or check that is prior to the actual date of occurrence. A cheque bearing a date prior to the actual date of si.....

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Arbitrage

Arbitrage

Arbitrage is the strategy of taking advantage of price differences in different markets for the same asset. It is an operation in which a person buys goods in one (cheaper) market and sells in another (dearer) market in order to make a profit out of the price difference. It happens when a securit.....

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Features of the Installment Purchase System

Features of the Installment Purchase System

Under the installment purchase system, there is an outright sale of goods with the buyer having the facility to pay the purchase price in a certain number of agreed installments. In this system, a certain amount is paid as a down payment amount at the time of signing the agreement. The buyer make.....

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Apportionment

Apportionment

Apportionment Apportionment means division into parts and it is used in accounts and insurance business. It is the act of sharing something between several people or organizations. The basis used for the apportionment of costs between a number of cost centers when the costs are to be shared be.....

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Concept of Installment System

Concept of Installment System

Concept of Installment System An installment system is just like a credit purchase and hires a purchase system of selling and buying goods. It is a credit system of purchase and sale of goods in which payments or receipts are made on an installment basis over a period of time. Like, hire purchase.....

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Difference between Hire Purchase and Installment System

Difference between Hire Purchase and Installment System

Both hire purchase and installment sales are popular methods of financing goods. There are 3 parties in Hire Purchase trade namely the seller, the financier, and the buyer. There are only 2 parties involved in Installment sale namely the seller and buyer. The main dissimilarities or difference be.....

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Annuity

Annuity

Annuity An annuity is a payment made to the insured annually. It is a financial product that pays out a fixed stream of payments to an individual, and these financial products are primarily used as an income stream for retirees. It is a contract between you and an insurance company in which you m.....

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Amalgamation

Amalgamation

Amalgamation Amalgamation is a type of merger process in which two or more companies combine together to form a new entity. It is a combination of two or more independent business organizations carrying on the business of a like nature into a joint one and thus forming a new company. It results i.....

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Methods of Recording Transactions under the Installment System

Methods of Recording Transactions under the Installment System

Methods of Recording Transactions under the Installment System In the installment system, there is an immediate sale, in which the price, instead of being paid in one lump sum, is spread over a period, interest is charged on unpaid balances. An installment sale is a financing arrangement in which.....

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