Author name: duro328

Positive changes indicate improved liquidity, while negative changes may suggest financial strain. For instance, suppose a retail company experiences an increase in sales, resulting in higher accounts receivable (A/R) due to credit sales. At the same time, the company effectively manages its inventory levels and negotiates favorable payment terms with suppliers, resulting in slower growth […]

Basically, ASC 606 stipulates that you recognize internally and for tax purposes revenue as you perform the obligations of your sales contract. While you have the money in hand, you still need to provide the services. This requires special bookkeeping measures to make sure you don’t forget about your customer and to keep the tax