CA Wallah Intermediate
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πŸ“Š Accounting Standards
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How do you calculate Material Cost Variance (MCV)?
What Does Section 73 Define and Write Its Key Points ?
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πŸ“˜ Topic: Accounting Standards (AS) β€” Importance & Relevance

Accounting Standards (AS) are the written policy documents issued by the ICAI to standardize accounting practices across companies and industries in India.

βœ… Why are AS important?

* Ensure transparency and comparability of financial statements
* Provide a framework for consistent accounting treatment
* Reduce ambiguity and scope for manipulation
* Align Indian practices with international norms (especially under convergence with Ind AS)

βœ… Examples of Key AS for CA Intermediate:

* AS 10: Property, Plant & Equipment
* AS 2: Valuation of Inventories
* AS 9: Revenue Recognition
* AS 20: Earnings Per Share
* AS 26: Intangible Assets

βœ… Exam Tip:
Focus on the applicability, measurement, and disclosure requirements under each AS. Questions often test your ability to apply these standards in practical scenarios.
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πŸ“˜ Word of the Day: "Deferred Revenue"

πŸ” Meaning:
Deferred revenue refers to the advance payment received by a business for goods or services yet to be delivered or performed. It is recorded as a liability on the balance sheet until the revenue is earned.

πŸ“Œ Why it’s important for exams:
Frequently tested in Accounting Standards, especially under AS 9 – Revenue Recognition. You must understand the timing of revenue recognition and journal entries involved.

πŸ“ Example:
If a company receives β‚Ή50,000 in advance for a one-year subscription service, it records the amount as deferred revenue and recognizes it monthly over 12 months.