Basic Points of Accounting [ Part 7-End ]

Basic Points of Accounting [ Part 7-End ]

Written By : Sakin17

• Preview :

1. 17 Safety Margin

Sales - Sales in break even point / Sales

1. 18 Operating Leverage 

Contribution margin / Operational profit

 

1.19 Rate of Return Of Investment 

 

• Post Today 

1. 19 Rate of Return of Investment

Operational Profit/Amount of Asset Investment

or you can use other method

ROI = (operational profit/sales) x (sales/amount of asset investment)

1. 20 Method of Capital Investment Analysis 

1. a.) The method which ignore the present value :

• Average rate of return method
• Return cash method 

    b.) The method which uses the present value

• Net present value method
• Internal rate return method

1. 21 Average Rate of Return

Average estimate of Annual Profit/Average of Investment

1.22 Index of Present Value 

Amount of present value from net cash flow/The amount that will be invested 

1. 23 Factors Present Value for annuity for Rp.1 

 Factors Present Value for annuity for Rp.1 = The amount that will be invested/Equal annual net cash flow

OK, That all about Basic Points of Accounting, for you know I took it from my book that has tittle "Principles of Accounting-Indonesia Adaption" edition 1 , written by James M. Reeve, Carl S. Warren, Jonathan E.Duchac, and friends. 

Thank you very much, may be useful :)