KALYAN CITY BLOG

1. Meaning ↓ Loco price includes the cost of goods at the factory or godown of the seller. Franco price includes the cost of goods plus all expenses upto the buyer's warehouse. 2. Preference ↓ The seller normally prefers Loco price. The buyer normally prefers Franco price. 3. Seller's Liability ↓ In case of Loco price, normally, the liability of the seller ceases once the goods leave his factory. In case of Franco price, the liability of the seller may continue till the goods reach the buyer's place. 4. Arrangement of Transport and Insurance ↓ Under Loco price, the buyer normally arranges for transport, insurance, etc. Under Franco price, the seller normally arranges for transport, insurance, etc. 5. Lowest and Higest Price ↓ The Loco price is the lowest price. The Franco price is highest price. 6. Other Names ↓ Loco price is also called as Ex-Factory or Ex-Warehouse Price. Franco price quotation is also known as Rendu Quotation .

1. Meaning ↓ Proforma Invoice is a quotation given in the form of invoice. Invoice is a bill of a sale transaction showing the amount to be paid by the buyer . 2. When Sent? Proforma Invoice is sent at the request of the buyer before he places the order. Invoice is sent after the goods being despatched by the seller . 3. Purpose ↓ Proforma Invoice enables buyer to decide whether to place the order or not. Invoice helps the buyer to know the exact amount due by him to the seller. 4. Legality ↓ Proforma Invoice does not have any legal validity. Invoice is a legal document, and can be produced in the court. 5. Entries in the Books of Account ↓ Under Proforma Invoice, there is no question of passing entries in the books of account. Invoice provides a basis for recording entries in the books of account. 6. Buyer's Responsibility ↓ The buyer is not bound by a proforma invoice to place an order or to some other thing. The buyer is bound to make ...

Difference Between Debit and Credit Note The difference between debit and credit note is explained as follows: 1. Meaning Debit note is a note sent by one party to another informing him that his account is debited in the sender's book. Credit note is a note sent by one party to another informing him that his account is credited in the sender's book. 2. Details Debit note contains details as to why the party is debited and the amount of debit. Credit note gives details as to why the party is credited and the amount of credit. 3. Acknowledgement Debit note requires an acknowledgement from the receiver by a credit note. Credit note requires an acknowledgement from the receiver by a debit note. 4. Written in which Ink? Debit note is usually typed or written in blue ink. Credit note is usually typed or written in red ink. 5. When Note is Sent? When Debit Note is sent? Debit note can be sent by buyer when he is overcharged. It can be sent by buyer when he return...

1. Meaning ↓ Trade Discount is a discount allowed by the seller to the buyer in case of bulk purchases made by him. Cash Discount is a reduction in the net amount payable by the buyer when prompt payment is made by the buyer. 2. When Allowed? Trade discount is usually allowed when bulk purchases are made. Cash discount is usually allowed if payment in cash is made promptly i.e. within a short period of time. 3. Purpose or Objective ↓ Trade discount's object is to attract bigger orders by giving incentive to the buyer to buy more. Cash discount's purpose is to encourage the buyer to make prompt payment. 4. How Calculated? Trade discount is calculated as a percentage of the catalogue price. Cash discount is calculated as a percentage of net amount payable by the buyer. 5. Variation in Rate ↓ Trade discount rate varies according to the type and quantity of goods purchased. Cash discount varies according to the period of payment. 6. Entry in the Books of Acc...

1. Meaning ↓ A cash memo is a document stating cash received for the goods sold. It is a paid bill for cash sales. An invoice is a document showing the amount due from the buyer or the debtor it is a bill for credit sale. 2. When Issued? Cash memo is issued in the case of a cash transaction. Invoice is issued in the case of a credit transaction. 3. Proof ↓ Cash memo serves as an evidence of cash being paid by the buyer to the seller. Invoice serves as an evidence of the indebtedness of the buyer to the seller. 4. Creditor Debtor Relationship ↓ Cash memo does not create creditor debtor relationship between the seller and the buyer. Invoice creates creditor debtor relationship between the seller and the buyer. 5. Accounting Entry ↓ Cash memo is entered in the cash book of the seller. Invoice is the basis for making entries in sales book and purchase book. 6. Revenue Stamp ↓ In case of Cash memo, one revenue stamp is to be affixed if the cash r...

1. Meaning ↓ Invoice is a bill of a sale transaction showing the amount to be paid by the buyer. Delivery note is a note sent by the seller to the buyer informing about the despatch and delivery of goods. 2. Contents ↓ Invoice gives details of a sale transaction i.e. description of goods supplied, rate, expenses, amount payable, etc. Delivery note only gives details of quantity supplied. 3. When Sent? Invoice is normally sent after the despatch of goods or along with the goods. Delivery note is sent along with the despatch of parcel. 4. Who Prepares? Invoice is prepared by accounts department. Delivery note is prepared by despatch department. 5. Acknowledgement ↓ In case of invoice, there is no need for any acknowledgement from the buyer. Delivery note needs to be acknowledged. 6. Accounting Entries ↓ Invoice forms the basis for accounting entries in sales and purchase books. Delivery note cannot be the basis for making entries in the books of acc...

1. Meaning ↓ Maslow's theory is based on the concept of human needs and their satisfaction. Hertzberg's theory is based on the use of motivators which include achievement, recognition and opportunity for growth. 2. Basis of Theory ↓ Maslow's theory is based on the hierarchy of human needs. He identified five sets of human needs (on priority basis) and their satisfaction in motivating employees. Hertzberg refers to hygiene factors and motivating factors in his theory. Hygiene factors are dissatisfiers while motivating factors motivate subordinates. Hierarchical arrangement of needs is not given. 3. Nature of Theory ↓ Maslow's theory is rather simple and descriptive. The theory is based long experience about human needs. Hertzberg's theory is more prescriptive. It suggests the motivating factors which can be used effectively. This theory is based on actual information collected by Hertzberg by interviewing 200 engineers and accountants. 4. Applicability of ...

1. Function ↓ The main function of a Commercial Bank is to accept deposits from public for the purpose of lending to industry and others. The Central Bank regulates money supply in the country. It also acts as a banker to the government and to the other banks operating in a country. 2. Printing of Currency ↓ The Commercial Banks cannot print currency notes and make coins. The Central Bank of India (i.e. RBI ) has the power to print currency notes from Rs.2 and above. 3. Acceptance of Deposit ↓ The Commercial Bank accepts deposits from the public. The Central Bank don't accept any deposit from the public. 4. Provision of Loans ↓ The Commercial Bank provides loans to the industry and to the public. The Central Bank provides loans to scheduled banks and financial institutions. 5. Ownership ↓ Commercial Banks can be owned by private and / or Government agencies. Central Bank of India (RBI) is owned and controlled by Government of India. 6. Tota...